The effect of COVID-19 has been both rapid and far reaching. In light of the current pandemic, the Crown Commercial Service has released a new Procurement Policy Note to provide guidance to contracting authorities.
If contracting authorities have an urgent requirements for goods, services and works due to COVID-19, but are caught by the Public Contracts Regulations, the CCS has confirmed there are a number of options available.
Contracting authorities could:
- direct award due to extreme urgency;
- direct award due to absence of competition or protection of exclusive rights;
- call off from an existing framework agreement or dynamic purchasing system;
- call for competition using a standard procedure with accelerated timescales; or
- extend or modify an existing contract during its term.
We have provided a summary of the tests that have to be met for a direct award on the grounds of extreme urgency below:
- There must be genuine reasons for the extreme urgency – for example the contracting authority needs to respond to the consequences of COVID-19 immediately because of public health risks or because existing service provision is no longer available at short notice.
- The events that have led to the extreme urgency were unforeseeable – the impact of COVID-19 was completely unforeseeable and so would satisfy this test.
- It is impossible to comply with the usual timescales in the PCR 2015 – this should be easily satisfied if there is an extreme urgency for the requirement.
- The situation is not attributable to the contracting authority – the COVID-19 outbreak is in no way attributable to contracting authorities but this test means that the contracting authority cannot have done anything to cause or contribute to the need for extreme urgency.
Contracting authorities will need to retain a written justification that demonstrates why these tests are met. This should be subject to ongoing review to ensure that the tests are still met before undertaking any subsequent or additional procurement.
Key points:
- Contracting authorities should limit their requirements only to what is absolutely necessary both in terms of the goods, services or works being procured and the length of the contract.
- Delaying or failing to do something in time does not make a situation qualify as extremely urgent, unforeseeable or not attributable to the contracting authority.
- There must be a genuine reason for the urgency. In the current circumstances we would expect the urgency to be driven by public health and/or safety risks.
- Contracting authorities are still expected to achieve value for money and use good commercial judgement. Any abnormally high pricing should be approved by the relevant director.
- Contracting authorities should consider putting in place mechanisms so that they can achieve price reductions throughout the term of the contract.
- A log should be kept of any decisions made with supporting reasoning for audit purposes.
