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Supporting People - Supporting Independent Living: Folder 2 - Part 3: Operational Guidance and Part 4: Financial Guidance
3. Procurement issues about Interim Contracts
3.1 Background
3.1.1 The Scottish Executive are working with authorities to ensure that existing services continue uninterrupted in April 2003, to protect existing supported housing service recipients. In doing this we have provided the means to map services, instructions on information to collect relevant to cost, and a draft model contract.
3.1.2 A number of authorities have asked for further guidance on the implications of the EC procurement regime on these activities. This attached note provides guidance for authorities in the letting of interim contracts. The Executive considers that these interim contracts are essential to provide for a smooth transition to the Supporting People regime and to prevent vulnerable people suffering a disruption to their service provision during the transitional period. Authorities are therefore advised that the Executive wishes the interim contracts to be put in place in all cases. Where authorities consider that there is a significant or serious risk of challenge in respect of the interim contract arrangements, in the light of the advice given in this note and their own legal advice on it and all related matters, they should consider this risk in planning the timing of their programme of reviews of existing services. This may lead to an urgent review and possibly a consequent new procurement exercise for those specific services.
3.2 In-house Services
3.2.1 Where an authority provides housing related services as part of direct service provision, no procurement issues arise in this context. The authority still has to comply with the duty of best value in respect of these services and must consider the manner in which the services are provided with the aim of meeting this duty.
3.3 The Public Services Contracts Regulations 1993
3.3.1 A Local Authority is a 'contracting authority' for the purposes of these regulations. In awarding an interim contract authorities will have to consider the application of the regulations. In some cases the authority will consider that the interim contract falls below the financial threshold contained in the regulations. In these cases the authority is likely to take the view that the regulations do not apply. For those cases where the regulations do apply, the interim contracts are likely to be for services that fall within Part B of Schedule 1 to the Regulations. Therefore authorities are likely to take the view that the full rigour of the regulations will not apply (see paragraph 7 on aspects which will apply). In the event that an authority is challenged for a failure to comply with any part of the regulations then the challenge can be made in the Court of Session.
3.4 General EC Treaty Requirements
3.4.1 Even where the Public Services Contract Regulations do not apply or where they apply only in Part, local authorities must abide by general EC treaty principals in procuring services. In most cases local authorities standing orders will be designed to safeguard the treaty principles of equality, transparency, competition and free movement of goods, services and people when seeking to award contracts interim or otherwise.
3.4.2 In the event of an authority being in breach of general treaty principles, action (including infraction proceedings) may be taken by the European Commission against the UK Government. Alternatively an aggrieved potential supplier could take legal action against the authority concerned if it considered that there had been a breach of treaty principles.
3.5 Best Value as it Relates to Procurement and Service Delivery
3.5.1 Best value will apply to local authorities in respect of the services that they contract for using Supporting People grants. A key element of best value is the requirement on authorities to review their functions in an objective manner and to consider whether they are delivering services in the most appropriate manner The Executive is intending to require authorities to review in the initial years of the grant all of the services that are funded via the Supporting People grant. These reviews are to be conducted with a view to rearranging, altering or providing services in a different and improved way in the future if that is found to be appropriate. This is, in our view, consistent with best value and authorities should be clear that the expectation is that the Supporting People contracts must be managed in accordance with best value.
3.6 Human Rights Considerations
3.6.1 As with all areas of their activity local authorities will need to remain mindful of Human rights implications of procedures adopted or of a particular approach taken.
3.7 Requirements in Respect of the Public Services Contracts Regulations 1993 (assuming that services are Part B)
3.7.1 The procurement regime for Part B services is less rigorous than the procurement regime that applies in respect of Part A services. Procurement of Part B contracts is subject to the following regulations in the 1993 Regulations (and to applicable general EC treaty provisions).
(a) Regulation 8 (technical specification). This regulation sets out the rules for a technical specification as regards the contract.
(b) Regulation 22 (contract award notice). This regulation requires an authority that has awarded a contract, no later than 48 days after the award, to send a notice to the Official Journal in substantially the form set out in the 1993 Regulations.
(c) Regulation 27(2) (statistical and other reports). This regulation requires certain statistical information to be provided to the Treasury annually.
(d) Regulation 28 (responsibility for obtaining reports). This regulation requires certain reports to be sent by the contracting authority to the Minister whose areas of responsibility are most closely connected with the functions of the contracting authority.
(e) Regulation 29 (publication of notices). This regulation sets out certain matters with regard to notices sent to the Official Journal.
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