Councils to call for simplified procurement rules post-Brexit, says LGA

18 Aug 17

Councils will press the government to simplify procurement rules once the UK leaves the European Union, the Local Government Association has said.

This will end the requirement for public contracts to be advertised across all member states, the councils’ umbrella-group stated.

The LGA said a replacement system should give councils greater flexibility over the £55bn they collectively spend each year on goods, works and services.

This could include powers to use local suppliers, specify a minimum local wage for suppliers’ employees and stipulate social value requirements, such as employing or training a proportion of local people.

A new system should also allow councils to procure at shorter timescales and with lower high administration costs for businesses.

The LGA said councils at present had to advertise contracts above certain thresholds in the Official Journal of the European Union (OJEU).

Such contracts could take between three and 18 months to let - twice as long as typical private procurements - even though almost no public ones were awarded to companies based in other EU member states, it said.

Just 20% of English councils received expressions of interest from companies based in other EU countries when they advertised in the OJEU, and across the EU only 1.6% of public contracts were awarded to companies in other member states.

Kevin Bentley, chair of the LGA’s Brexit task and finish group, said: “Regulation of public procurement will clearly continue to be necessary when we leave the EU to allow councils to continue to demonstrate best value for money and ensure effective and fair competition.

“But introducing more local flexibility and easier procurement rules after Brexit would provide more community benefits and more growth opportunities for SMEs."

He added: “It would also allow councils to promote local suppliers and local labour and ensure workers earn a decent wage.”

Paul Dossett, head of local government, Grant Thornton UK LLP, echoed Bentley’s view that there was an opportunity to create a procedure, which offered more support to local businesses growth.

He said: “Given the ongoing financial pressures facing councils, local authorities are increasingly being expected to demonstrate value for money and effective commercialisation, and sometimes this can only be achieved through engaging with other organisations, even if they are not locally based.

Although, he warned: “The government will need to ensure that any relaxation of the current procurement rules does not undermine the quality, safety or financial viability of the process.”

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