The use of large up-front fees and disproportionate deposits has already resulted in significant cost consequences for one care provider.
Turning Point was unsuccessful in its challenge, and the reasoning behind the Court’s ruling has wider implications, not only in terms of social care procurement, but also across the public sector.
Until recently, UK legislation imposed a three month time limit within which a public procurement process could be challenged. However, in October 2011 the Government reduced this to just 30 days for most claims. Before the Turning Point case it was thought that in most situations, it would be possible to argue that the time limit would start from when a council or any other contracting body officially awarded a contract. The Court has now clarified that the time limit for challenge could expire well before then.
The dispute between Turning Point and the Council arose as Turning Point alleged that the Council had not provided them with sufficient TUPE information regarding employee regulations and that this had consequently impacted their tender submission. The Court ruled that the time limit to bring a complaint began when Turning Point submitted its tender and potentially even as soon as they knew that the information was inadequate. It was thus ruled that the time limit to challenge the decision had since run out.
In real terms, this means that if a bidder wants to complain of unfairness arising from the evaluation criteria or from the amount of information provided in the process, proceedings may need to begin before a contract award notice has been issued.
Many councils are no doubt hopeful that this ruling will mean fewer claims, with the expectation that bidders will not want to raise issues half way through a procurement process. However, feedback from some national contractors suggests that, if it is a choice between bringing a claim before the process is even complete or not bringing a claim at all, many would choose the former.
In limited circumstances Judicial Review can be an alternative route for challenge by bidders. However, the Government is also intending to reduce the time period for seeking a Judicial Review of public procurements so that these are brought into line with the 30 day time limit imposed by the EU procurement regulations. The Government Consultation closed on 23 January 2012 and a Bill is now awaited. This step is being taken with the declared intention of reducing the number of decisions reviewed but time will tell whether it is successful or whether reviews are also sought earlier in the process.
The difficulty now for procurement teams is knowing how to successfully steer their organisations through this rapidly changing legal landscape. There is the risk of procurements being derailed by bidders at a far earlier stage and therefore it is essential for housing providers to keep in mind the fundamental principles of transparency and non-discrimination. When bidders raise concerns during the process, these should be taken very seriously. If the issues are not addressed fairly and promptly, the risk of challenge at an earlier stage is now significantly increased.
On-going training and timely advice is now more important than ever in a fast changing area of law, which carries many risks for the delivery of a Council’s service objectives. Nevertheless, it is not all bad news for local government. The chances are that more challenges will be out of time and so can be dealt with outside of a Court setting. However, nothing should be left to chance and councils need to develop a tactical awareness of how procurement processes can be shaped to avoid challenges being made part way through and not just when the contract award decision has been made.
For more information
Contact Andrew Lancaster on firstname.lastname@example.org or telephone 0121 212 7421 if you'd like to know more.
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