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When procurement goes Nuclear


When procurement goes Nuclear

April 7, 2017 11:10 AM | Posted by Prandy, Helen | Print this page

Even as a procurement specialist I am forced to admit that public procurement is not the most exciting or glamorous subject. There are not many scripts kicking around in Hollywood which feature a procurement lawyer as the main protagonist but just as no one notices the referee until he makes a bad decision when public procurement goes wrong it can go really wrong and the consequences for nearly all involved can be disastrous.

In August 2016 we blogged about the case of Energy Solutions Ltd v The Nuclear Decommissioning Authority in which a judge had characterised an evaluation by the NDA as “fudged” and verging on the “incredible”. With further aspects of the case before the courts and a pending appeal to the Supreme Court the NDA recently acknowledged that the procurement process had been fundamentally flawed.

In doing so, it was forced to terminate a £6.1 billion contract 9 years early and pay a total of £97.5m in compensation, effectively out of the pockets of us, the taxpayers. On top of that the government has ordered an enquiry into the conduct of the procurement, jobs are likely to be lost and the lead contractor for the “winning bidder” had 3% knocked off its share price on the news.

Clearly not all public procurement is so high profile and mistakes will not have such wide-ranging consequences but the reasons for the failure of this procurement are an object lesson to all contracting authorities to ensure that evaluation is carried out fairly and transparently and that clear records are kept of all evaluation decisions and an appropriate audit trail established.

By Helen Prandy - read more about Helen here

Highlights

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