Preparing for change: Award stage

The PA23 intends to consolidate and streamline the current procurement regulatory framework, which is currently based on legacy EU law, and in doing so simplify the procurement process to better meet the UK’s needs.

This article, which is part of a series of deep dives into the new procurement lifecycle, will focus on the award stage of a procurement.

MEAT to MAT

The PA23 moves away from the existing requirement to award contracts to the ‘Most Economically Advantageous Tender’ (“MEAT”) by instead requiring contracts to be awarded to the ‘Most Advantageous Tender’ (“MAT”), being the tender that a contracting authority considers both:

• satisfies its requirements; and
• best satisfies the award criteria, which can (as previously) include both price and quality evaluation.

The transition from MEAT to MAT is therefore more of a change in emphasis and signposting rather than of substance, as recognised in the Transforming Public Procurement Green Paper which indicated that the purposes of the change in terminology was to “provide greater reassurance to contracting authorities that they can take a broader view of what can be included in the evaluation of tenders in assessing value for money”.

There are two points which may, however, become important, depending how this new term is interpreted and applied. Firstly, the change in tone and the underlying explanation is a signal that government expects authorities (and the courts) to be more open minded about overall advantage during design and award. Perhaps a slavish focus on economic value will not be supported.

Secondly, the addition of a requirement for the winning tender to “satisfy the authority’s requirements” as well as being “‘most advantageous”, is new. Whether this will in reality be an additional step which may change a procurement outcome remains to be seen. It is hard to imagine a scenario where a most advantageous tender does not also satisfy the authority’s requirements – but unusual facts may arise in due course where this plays out in a challenge.

Changing the process mid-procurement

The PA23 contains provisions that allows for contracting authorities to alter procurements in several respects after the procurement has begun. For instance, tender requirements, conditions of participation, and award criteria can all be amended or refined at various points during a procurement under the new regime. This represents a departure from the current regime, which does not expressly provide for mid-procurement changes to the adopted process.

The PA23 does not provide free reign to alter a tender’s requirements at any point during a procurement, as such changes can only be made:

Additionally, where a contracting authority does modify the terms of a procurement, the authority must also “revise and republish or provide again the tender notice and any associated tender documents affected by the modifications”.

This may mean that the (unofficial) practice of rewinding a procurement to a previous stage is replaced by the new refinement provisions in the PA23. In that case authorities should be cautious of relying on the use of former practices. While different in structure and formality, however, the approach to refinement permitted by the PA23 may not in practice be substantively different to rewinding a procurement.

Contract Award Notices and the Assessment Summary

Prior to entering a contract under the new regime, contracting authorities will be required to publish a Contract Award Notice (a “CAN”), setting out the intention to enter a contract with the winning tenderer(s). Following consultation, the Government has concluded that unsuccessful suppliers should only be named in CANs where the contract value is at least £5m, to mitigate against any disproportionate effects on small and medium-sized enterprises. Much of the other required information is unsurprising and uncontroversial, largely mirroring the current requirements. In addition, there will be a separate, shorter CAN requirement for procurements of private utilities.

However, prior to publication of a CAN, a contracting authority must provide an “assessment summary” to each supplier that submitted an assessed tender. An assessment summary provides each tenderer with the scores their tender was awarded, accompanied with an explanation for each score with specific references to the relevant bid content for each criterion.

The current draft of the secondary legislation and the associated guidance also requires an authority to provide a copy of the winning tenderer’s assessment summary to unsuccessful tenderers. This is likely to be in redacted form to preserve any confidentiality in the contents of the winning tender.

In theory, this should reduce the administrative burden on contracting authorities at the point of contract award, as this element of the assessment summary replaces the current requirement to outline the comparative advantages of a winning tender to unsuccessful bidders in standstill letters. However, contracting authorities will need to ensure that each assessment summary is coherent when viewed against the assessment summary of the winning tender, as a failure to do so could indicate to an unsuccessful tenderer a basis to challenge the award decision. Further, to avoid misinterpretation, the Government is removing the previously proposed requirement to provide detailed reasons as to why the next score immediately above was not achieved (although we expect the accompanying guidance to make clear that this approach will be considered best practice).

Challenge during the standstill period

The standstill period is a mandatory period between the notification of outcome to tenderers and the date of contract award. A contracting authority isn’t permitted to enter a public contract until the applicable standstill period has elapsed.

Under the PA23, the standstill period is either the mandatory standstill period of 8 working days (beginning on the date the contract award notice is published), or if longer, a standstill period specified in the CAN. Under the current regime, the mandatory standstill period is generally 10 days from the date that tenderers were notified of the outcome to the procurement. The change from ‘days’ to ‘working days’ irons out the existing anomaly that in practice challenge times depend when an award letter is sent (i.e. sent on a Friday or before a public holiday provides fewer working to respond than if sent on a Monday).

Additionally, it is currently commonplace to agree to extensions to the standstill period, a practice which isn’t accounted for in the wording of the PA23. The availability of the “automatic suspension” of award also seems to depend upon issue during the standstill rather than on whether a claim is issued before contract signature (as currently). This may mean unsuccessful tenderers feel compelled to issue defensive challenges to the award decision, which in turn allows the tenderers and the contracting authority less time to evaluate the viability of a challenge to the award decision. Should this approach become a practical necessity in order to properly evaluate the grounds for challenge, some tenderers may be de facto excluded from challenging award decisions due to an unwillingness to pay the required issue fee without having first undertaken a detailed evaluation of the merits of claim.

How can we help? 

We will be releasing further updates on other aspects of the PA23 shortly and holding workshops on the new regime throughout 2024. Please contact Laura Wisdom or another member of our procurement team if you would like to receive updates, including if you are interested in tailored workshops on issues specific to your organisation. 

Read previous articles in the series here >>>