New procurement directives come into force

New EU procurement directives come into force today 17 April 2014. The UK government now has two years to implement the new rules into national law although the government continues to state that it intends to do so more rapidly.

The new directives bring about a number of changes to the existing procurement law regime. For commissioners the area of particular relevance is the abolition of Part B services. This does not however mean that all health services will have to be tendered in accordance with the full rules procedures and timescales imposed by procurement law. Instead healthcare services (along with many other former Part B services) will be subject to a new light touch regime.

Under the new light touch regime it will be mandatory to advertise contracts for NHS funded health services in OJEU if their value exceeds 750,000 Euros. At present this is not required.

The remaining details of the light touch regime are to be decided nationally. The EU directive requires only that the light touch regime complies with the usual EU Treaty principles such as equal treatment and transparency. The UK government issued discussion papers on the options for the new regime last year and the responses are being taken into account. We await further information as to what the UK government decides. Note that one option is to specify that contracts can only be awarded on the basis of price-quality ratio and not lowest price alone. In practice this is unlikely to make a difference to the award of healthcare services contracts particularly as the Procurement Patient Choice and Competition (No. 2) Regulations 2013 already require commissioners to award contracts to the providers most capable of meeting patient needs as well as providing the best value for money.

Commissioners should bear in mind that the Procurement Patient Choice and Competition (No. 2) Regulations 2013 will continue to apply to the commissioning of NHS services just as they currently apply alongside the existing procurement regulations.

Finally a reminder that all procurement policies procedures and standard documentation used by commissioners will need to be updated in line with the new rules in due course.

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