Urgent procurement for critical goods, works and services: a short guide
As the UK's response to the global COVID-19 coronavirus outbreak escalates, public authorities in the UK may find themselves under pressure to make short notice awards in order to urgently procure critical services, works or supplies of key products. In recent days, the Health Secretary himself made an urgent plea for manufacturers to turn production lines over to ventilator production for the NHS, promising "if you produce a ventilator then we will buy it – no number is too high".
Direct award exemptions
The Regulation 32 provisions of the Public Contracts Regulations 2015 (PCR) permit, in specific limited circumstances, the use of the negotiated procedure without prior publication, for the award of public works, public supply or public service contracts – circumventing the normal procurement timescales and procedures.
The limited circumstances include the "reasons of extreme urgency" exemption:
"insofar as is strictly necessary where, for reasons of extreme urgency brought about by events unforeseeable by the contracting authority, the time limits for the open or restricted or procedures or competitive procedures with negotiation cannot be complied with” (Regulation 32(2)(c))
The circumstances invoked to justify the "reasons of extreme urgency" must not "in any event be attributable to the contracting authority" itself.
Practical steps when considering urgent awards
It follows that there must be urgent time pressure, itself brought about by an unforeseeable event and not due to the actions or inaction of the authority, meaning that the usual time limits for a negotiated process cannot be complied with - as opposed to an authority realising it is too late to run a normal negotiated process on the usual timetable before the date by which the service or product is required.
In the current context, examples may include the procurement of urgent medical equipment, supplies or extended medical capacity; measures needed to ensure a public authority can provide continuity of support for key services if the circumstances result from the COVID-19 crisis; or procuring alternative supply where an existing provider is unable to deliver because of the crisis. Appropriate circumstances could clearly apply to authorities operating beyond the health and medical sectors.
It is hard to see the above examples failing to meet the "extreme urgency" requirements, if an award is made in the direct context of responding to a wholly unforeseen global pandemic and where immediate action is required by the contracting authority. Where an urgent need arises to protect public health or provide essential services, the use of the exemption should be easier to justify.
Keeping an accurate paper trail demonstrating how the urgent need for services or supplies came about in the context of the COVID-19 outbreak may help push back on any challenge to a contracting authority's decision to rely on the "extreme urgency" exemption. Likewise, immediate action to implement the outcome of an expedited award process may also help.
Authorities faced with a need to make urgent awards during the crisis should seek legal advice on whether the Regulation 32(2)(c) exemption is appropriate, and to explore whether there are alternatives.
Since writing this briefing, the Cabinet Office has published a Procurement Policy Note (PPN 01/20), setting out useful detailed guidance in respect of the Regulation 32(2)(c) exemption, consistent with the points covered above, and on other options for urgent procurements under the PCR.
AG's public procurement team is ready to provide urgent advice and support, both prior to an award being made and in the event of challenge. Please contact any of the following to discuss further: