Further Detail

Replacement of EU reference with GPA

The Standing Orders have been updated to remove all irrelevant references to the European Union membership and replaced with current terminology which correctly reflects the UK’s membership of the World Trade Organisation (WTO) and the applicability of the WTO’s Government Procurement Agreement (“GPA"). This is largely a technical change to references, Scottish national procurement legislation remains broadly unchanged in procedural terms and is still largely aligned to the previously applicable EU directives.

Procurement Threshold Changes

The Standing Orders Relating to Contracts require to have the thresholds at which various procedural requirements apply altered to incorporate updated threshold values and the inclusion of VAT within certain thresholds for the purpose of determining which regulated procurement procedure applies.

This change is required under Scottish Procurement Policy Note (SPPN) 8/2021. This change is required due to the regular re-setting of thresholds to match international legislation and also the technical change to including VAT in certain thresholds as a direct result of the UK leaving the EU and joining the WTO GPA.

This is largely a technical change as the thresholds have increased by an amount almost equal to the standard rate of VAT, so will only have a material effect on contracts with a value close to the threshold which are reduced or zero rated for VAT. This will impact a very small number of contracts.

A briefing guide and technical guidance has been provided to procurement staff who are responsible for applying the new VAT inclusive thresholds.

Quick Quotes procedure threshold for Works

The Scottish Government recommend considering the use of the Quick Quote procedure for unregulated works contracts i.e. those with a value less than £2,000,000 in Construction Policy Note 1/2020.

This was initially designed to ease the burden on bidding contractors during the Covid pandemic. Ordinarily, the Standing Orders Relating to Contracts require works contract above a certain threshold to be tendered as if they were regulated contracts, however, this is subject to the Head of Strategic Procurement approving an alternative procedure. It has now become common practice to utilise the Quick Quote procedure for works contracts up to £500,000 as the default procedure and has proven to generate better value than open procurements both during and subsequent to the effects of the Covid pandemic easing. This minimises unnecessary bureaucracy for tenderers and provides a reasonable chance of success for the significant investment required to bid for a works contract.

It is proposed that the threshold for default utilisation of this procedure for works contracts is increased from £150,000 excluding VAT to £500,000 excluding VAT, noting that flexibility still exists for the Head of Strategic Procurement to authorise the use of Quick Quote for works contracts not less than £500,000 excluding VAT and less than £2,000,000 excluding VAT on a case by case basis where that route will secure best value.

Job title update

The title of Head of Procurement has been updated to Head of Strategic Procurement to reflect a job title change following the conclusion of the procurement re-organisation.

Recommendation

It is recommended that the revised Standing Orders Relating to Contracts are approved. On approval they will be published internally and externally on the Police Scotland Procurement intranet and public internet sites alongside other key documents such as the Procurement Strategy and Annual Procurement Reports.