It is certainly not the Government’s intention to exclude those groups of providers. In fact, we want to encourage them and make things easier and more transparent for them. I will take a look at Hansard and discuss the issues in Clause 32 with the team. We will make sure that, perhaps in those groupings throughout the summer period, we discuss these issues further; I will make a note to do that. It is absolutely our intention not to make this more difficult for those groups but to make it easier, so we will look at how we can do that if this clause makes things more difficult.
In Clause 33, Amendments 200 and 201 would clarify that, where a supplier does not qualify for the reserved contract, the contracting authority can exclude that supplier at any point in the procurement process. Amendments 203 and 204 to Clause 33 are simply to improve the drafting, as I said.
Amendment 206 would make it clear that suppliers will fail to be eligible for reserved contracts only where they have signed a “comparable contract”, as defined in subsection (7), within the previous three years, not just because such a contract was awarded to them. It ensures that there is no risk of a supplier being penalised where a contracting authority had decided to award a contract to a supplier but, for whatever reason, the contract did not progress.
I turn next to Clause 34. Amendment 209 clarifies that competitive flexible procedures can allow for the exclusion of a supplier from both participating and progressing in the procedure where the supplier is neither a member of a dynamic market, nor a part of a
dynamic market—for example, a category of goods or services. The current provision refers only to “the exclusion of suppliers”, and this change clarifies that this means participation and progression in the procurement by, for example, progressing to the next stage of a multi-stage procurement. Amendments 214 and 215 are consequential to this amendment.
Amendment 262 in Clause 48 changes “virtue of” to “reference to” for ease of reading.
Amendment 341 removes the more general reference to “procurement” in Clause 56, to clarify that notification of exclusion is required in all competitive tendering procedures.
Finally, Amendments 427 and 428 are technical amendments to Clause 78: the first to ensure drafting consistency across the Bill and the second to reflect the fact that Northern Ireland and Wales have derogated from this provision and so do not require the threshold-altering powers in subsection (4).
I turn now to Amendment 96, tabled by my noble friend Lady Noakes, which questions why a supplier “must” satisfy the conditions of participation in Clause 18(3)(a) to be awarded the contract, while in Clause 21(6) contracting authorities only “may” exclude the supplier from participating or progressing in the competition. I reassure noble Lords that the two clauses work together: suppliers must satisfy the conditions of participation in order to be awarded the ensuing public contract, and that is what is addressed in Clauses 18(3)(a) and 21(2). Clause 21(6) gives the contracting authority the flexibility to decide when to assess the conditions of participation, and at what point to exclude suppliers that have not met them. Having “may” in Clause 21(6) allows the condition to be assessed during the procedure. For example, when it comes to insurance requirements, a company may not have the full cover initially, but it may have the chance to obtain it before that contract is awarded. I hope that this makes it slightly clearer; if not, I am sure that we can discuss it further throughout the summer months.
I now turn to non-government amendments. Amendment 105 to Clause 19 from the noble Lords, Lord Wallace and Lord Fox—both of whom I hope will be better very soon—proposes to remove the competitive flexible procedure. The practical reality of procurement is that the open procedure is simply not appropriate in all circumstances. The government procurement agreement contains three procedures: open, selective and limited or direct-award tendering. The open procedure is popular where the requirement is well-defined and straightforward; price is likely to be the key feature. There is no pre-qualification of suppliers, any interested party can submit a tender and they must all be assessed.
We want contracting authorities to use the new competitive flexible procedure, which we could not have had when we were in the EU, to design fit-for-purpose procurements that deliver the best outcomes. This may mean including phases such as a prototype development when seeking innovative solutions. Contracting authorities will use it to limit the field by applying conditions of participation to take forward only those suppliers with
the financial and technical capability to deliver the contract. Clause 21(1) requires these to be proportionate so as not to disadvantage smaller suppliers.
The competitive flexible procedure also allows for negotiation and discussion of the requirements, which is particularly important to ensure not only that the best value is obtained but that requirements are clearly understood. The ability to negotiate is severely limited under the current EU-derived rules.
Clause 19(3) requires the contracting authority to ensure that any competitive tendering procedure is proportionate, having regard to the nature, cost and complexity of the contract. Amendment 107 from my noble friend Lady Noakes proposes to make these considerations from the perspective of the supplier. We believe that these assessments are better considered by contracting authorities in the round following pre-market engagement. Otherwise it would be possible for prospective suppliers to challenge and assert that a procedure is not appropriate.
To counterbalance the flexibility given to contracting authorities to design a competitive tendering procedure, we wanted to ensure that procedures do not become overly convoluted or burdensome for suppliers. We believe that Clause 19(3) achieves this, as it will force the contracting authority to consider what is proportionate, without suppliers dictating the specifics of the procedure. I understand that my noble friend Lady Noakes requires more clarity, and I am sure we can do that if that explanation did not provide it.