Water & Wastewater Treatment

WWT January 2017

Water & Wastewater Treatment Magazine

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Page 17 of 39

Close-Up A mid all the unanswered questions which have followed the June 23 referendum decision to leave the European Union, the issue of what happens to procurement rules has not been the highest profile. Yet it is a topic with the potential to inflame or enthuse people involved in providing public infrastructure – including the water sector – in equal measure. Intended to provide a level playing field for suppliers across the continent, the EU's Utilities Contracts Regulations provide a set of rules for the open tendering for goods, works and services and are closely related to the procurement regulations for public bodies. Any contract over a minimum level (currently £345,028 for goods and services and £4.32M for works) must have tender documents and contract notices published in the Official Journal of the European Union – OJEU – with the rules prescribing the timescales for the process and the required procedure for shortlisting and selection. There are separate rules for smaller lots, with one of the considerations being that similar packages of work are not artificially divided to get round the regulations. But the regulations are unloved by many in the industry. Critics say they have failed in the mission of opening up European markets to contractors, while imposing red tape and unwelcome cost on bidders, and the fear of legal challenge and delayed projects for clients. So with the UK heading out of the EU following the expected triggering of Article 50 in March 2017, is it time for a rethink? One organisation that is calling on the government to grasp the post-Brexit opportunity is the Civil Engineering Contractors Association (CECA) which argued the case for reform in a recent report. "Civil engineering contractors are primed to deliver a substantial project workload over the coming years, yet their ability to deliver these projects in the most efficient way is increasingly being stymied by burdensome procurement processes on projects large and small," comments Marie-Claude Hemming, CECA Head of External Affairs. "Our research suggests that this burden is caused, in part, by the rules that are enforced as a result of EU procurement regulations. While some of the EU processes are sensible, and ensure a competitive market for customers, the decision to leave the EU potentially opens the opportunity to look again at the bits that are not working as well." CECA's report identified eight common frustrations that its members experience with procurement processes (see box), although it remains a matter of debate how many of these can be attributed to client companies' application of the rules rather than the rules themselves. Andy Clark, Head of Procurement and Contract Management at Yorkshire Water, says that for all the criticism it receives, it is important to remember that OJEU is fulfilling a key function. "If OJEU didn't exist we'd have to create something reasonably similar to it, because we want to operate in a fair and transparent way and to have that open competition happening," says Clark. "There are certain prescribed periods and ways of working which are a bit inefficient, and I think if we were to do it for ourselves we would cut down some of those timescales and we'd be trying to find a more efficient route. But broadly the idea is right. "There's a certain mindset that it takes a long time to get through an OJEU process, but that's normally because people haven't been absolutely explicit about what it is that they want, and that can lead to the process being protracted because you then have to clarify with your suppliers what it is that you actually need. But if you've done that work up front, then actually an OJEU process can be completed relatively quickly." Water industry procurement Could Brexit provide a fresh start? 18 | JANUARY 2017 | WWT | www.wwtonline.co.uk ● Brexit could lead to re-examination of procurement rules ● OJEU requirements under the microscope ● Direct procurement could provide more opportunities for SMEs by James Brockett

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