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EDF Public Procurement - A Valuable Tool for Equality Legal arguments for procurement measures EDF Public Procurement - A Valuable Tool for Equality Legal arguments for procurement measures Christopher Mc. Crudden

Major issues in procurement n n n Whether to use procurement as a way Major issues in procurement n n n Whether to use procurement as a way of delivering services When procurement is used, how to prevent corruption, discrimination, favouritism, and promote efficient and effective procurement When procurement is used, how to ensure that it is used to deliver the broad social justice agenda of the government and not cut across it (linkage)

Problems in the past in using procurement n n Three problems with linkage in Problems in the past in using procurement n n Three problems with linkage in the past: Is it legal? Need to clarify what you can and can’t do legally Is it sensible and do-able? Need to meet civil service resistance/lethargy/fear Is it politically advantageous? Need to tackle political ignorance of the possibilities

More specifically … n n n What extra value (if any) does such linkage More specifically … n n n What extra value (if any) does such linkage bring, and at what cost? Are such linkages consistent with a view of procurement as an economic instrument of government? What legal limits are placed on the use of such linkages by, e. g. EC procurement directives?

Limits deriving from EC EC Treaty and Directives dating from 1970 s, culminating in Limits deriving from EC EC Treaty and Directives dating from 1970 s, culminating in reforms of 2003 n Initial relatively high level of tolerance towards domestic use of procurement linkages n From 1980 s to mid 1990 s: increasingly hostile reception, particularly from Commission n

Limits deriving from EC n n From mid 1990 s to current: rediscovery of Limits deriving from EC n n From mid 1990 s to current: rediscovery of linkages at domestic level; “green procurement”; Corporate Social Responsibility; “equality mainstreaming” ECJ approach opens up legal space, paving way for revised legislative approach in 2003 EC current approach: ITC/ILO study, leading to Commission guidance? Rüffert case on Posted Workers Directive and procurement

Domestic trajectory of procurement linkages Movement away from CCT and Thatcherite approach 1997 -2000 Domestic trajectory of procurement linkages Movement away from CCT and Thatcherite approach 1997 -2000 n New approach mostly under political radar, but significant n Too much happening to be comprehensive, focus only on equality issue n

Domestic trajectory of procurement linkages Prime Minister’s Strategy Unit Report 2003 n CRE-CBI approach, Domestic trajectory of procurement linkages Prime Minister’s Strategy Unit Report 2003 n CRE-CBI approach, and Code of Practice 2003 n National Employment Panel report to Chancellor 2003 n

Domestic trajectory of procurement linkages Department of Work and Pensions and Jobcentre Plus requirements Domestic trajectory of procurement linkages Department of Work and Pensions and Jobcentre Plus requirements 2006 n GLA approach on Translink, and Olympics contracts n

New factor: equality duties n n n Public sector equality duties (race, disability, gender) New factor: equality duties n n n Public sector equality duties (race, disability, gender) Requirement to have ‘due regard’ to the need to promote equality of opportunity When exercising public functions: initial dispute over whether procurement included Guidance from previous equality bodies Some progress in some bodies: GLA, Tf. L, ODA, West Midlands

Equality duty and procurement: first impressions n n n n Relatively little happening Different Equality duty and procurement: first impressions n n n n Relatively little happening Different dimensions of equality under-researched Reactive rather than proactive approach to assessment No clear nexus established between projects being undertaken and predicted effect on tackling inequality Equality duty appears to be seen as a subsequent add-on rather than as central Imposition rather than an opportunity Procurement modalities appear to be “off the peg” rather than “bespoke” EHRC research report on ODA

White Paper proposals New equality duty replacing existing duties n Explicit acceptance of importance White Paper proposals New equality duty replacing existing duties n Explicit acceptance of importance of equality duty for procurement n Whether, and how best to legislate? n What might a Clause dealing with procurement in the Equality Bill look like? n

Basic issues n n n Clear indication that ‘public function’ includes procurement, but is Basic issues n n n Clear indication that ‘public function’ includes procurement, but is that enough? Whether to carry out project by procurement should be subject to duty How to construct and award particular contracts should be subject to duty Distribution of procurement opportunities should be subject to duty Duty should be proactive and positive, not just reactive and negative

Further issues to be considered n n n To whom should the procurement duties Further issues to be considered n n n To whom should the procurement duties apply? To what contracts should the procurement duty apply? Do we legislate further what we mean by ‘equality of opportunity’? Do we legislate further what we mean by‘due regard’? What do we do about ‘value for money’? What do we do about sanctions, and ensuring compliance with the duties?

Elements of a clause n (1) For the avoidance of doubt, it is hereby Elements of a clause n (1) For the avoidance of doubt, it is hereby declared that for the purposes of this Act ‘public function’ shall be interpreted as including the purchasing of goods, works and services from outside contractors.

Elements of a clause n (2) Without prejudice to any other obligation in this Elements of a clause n (2) Without prejudice to any other obligation in this Act, a public authority shall have due regard to the need to [promote equality of opportunity, etc] when determining the desirability of exercising any of its functions by way of contract.

Elements of a clause n (3) Without prejudice to any other obligation in this Elements of a clause n (3) Without prejudice to any other obligation in this Act, a public authority shall have due regard to the need to [promote equality of opportunity, etc]— (a) when determining the appropriate definition of the subject matter of each of its contracts, (b) when determining the technical specifications of each of its contracts, (c) when establishing selection criteria for each of its contracts, (d) when establishing criteria for the award of each of its contracts, and determining the weighting to be given to these criteria, when the contract is awarded to the most economically advantageous tender, (e) when considering whether a bid is abnormally low, where any of its contracts is subject to competitive bidding, and (f) when considering the inclusion of contract performance clauses in each of its contracts.

Elements of a clause n (4) Without prejudice to any other obligation in this Elements of a clause n (4) Without prejudice to any other obligation in this Act, a public authority shall consider how best to encourage particular classes of firms that are under-represented in contracting with that public authority in comparison with other classes of firms to undertake more contracting for that public authority, having due regard to the need to promote [equality of opportunity, etc].

Elements of a clause n (5) In complying with its duties under subsections (2), Elements of a clause n (5) In complying with its duties under subsections (2), (3) and (4), a public authority shall consider— (a) measures which might mitigate any adverse impact of the contracting function on the promotion of equality of opportunity; and (b) measures which might better achieve the promotion of equality of opportunity through the contracting function.

Elements of a clause n (6) In this section “public authority” means a public Elements of a clause n (6) In this section “public authority” means a public authority [to which the public sector equality duty applies].

Elements of a clause n (7) Without prejudice to its duties under subsections (2), Elements of a clause n (7) Without prejudice to its duties under subsections (2), (3) and (4), a public authority shall in carrying out its functions relating to contracting have regard to the desirability of promoting value for money in the use of public funds. For the purpose of this subsection, ‘value for money’ means. F (a) securing works, goods or services without disproportionate expense, and F (b) the optimum combination of whole-life costs and quality to meet the public authority’s requirements.

Elements of a clause n (8) For the purposes of this section, ‘equality of Elements of a clause n (8) For the purposes of this section, ‘equality of opportunity’ [etc] means equality of opportunity— F (a) between persons of different religious belief, racial group, age, marital status or sexual orientation; F (b) F (c) between persons with a disability and persons without; and F (d) between persons with dependants and persons without. between men and women generally;

Elements of a clause n n (9) A public authority shall take all such Elements of a clause n n (9) A public authority shall take all such steps as are reasonable to secure that no work is executed or goods or services supplied for the purposes of the contract unless F (a) the public authority has complied with the duties under subsections (2), (3) and (4), and F (b) a contractor awarded a contract by the public authority has complied with any obligations resulting from the exercise of these duties. (10) Nothing in this section affects the validity of any contract.

Elements of a clause n (11) This section applies to the exercise by a Elements of a clause n (11) This section applies to the exercise by a public authority of contracting functions falling within a class or description for the time being specified by the Secretary of State, where work is to be executed or goods or services supplied. n (12) The Secretary of State shall by regulations make further provision regarding the duties established in this section. In particular, a regulation under subsection (11) may frame any class or description of contract by reference to— F (a) any work to be executed or goods or services to be supplied under the contract, F (b) any amounts to be paid under or in connection with the contract, F (c) any terms of the contract, and F (d) any surrounding circumstances.

Elements of a clause n n (13) The Secretary of State may by regulations Elements of a clause n n (13) The Secretary of State may by regulations make any provision which is necessary(a) for the purpose of safeguarding national security or protecting public safety or public order, or (b) for the purpose of ensuring compliance with European Community law. (14) The regulations(a) shall be made by statutory instrument, and (b) may not be made unless a draft has been laid before and approved by resolution of each House of Parliament.

Some issues for the future What are the best mechanisms for effective procurement linkages? Some issues for the future What are the best mechanisms for effective procurement linkages? n Can social regulators and social activists cope with non-traditional policy instruments? n Can politicians accept the constraints? n

Some issues for the future Can procurement practitioners engage effectively with non-traditional constituencies? n Some issues for the future Can procurement practitioners engage effectively with non-traditional constituencies? n Can the machinery of government cope with attempts to ensure joined-up government across departments? n What are the real costs and benefits? Empirical research needed n