National and Devolved Politics

05.06.20

Gov pays £1.7bn in procurement contracts for Covid response

A Tussell report (June 4) has revealed that nearly 400 Covid-related contracts have been awarded, worth over £1.7bn.

Public sector procurement has seen an 18% increase in published tenders in May compared to April, with an almost 300% increase on the Covid-related awards, as the traditional competitive tender process was put to one side to tackle the emergency.

Typical procurement rules were bypassed during the crisis, to access emergency provisions, with report also finding that of the 385 contracts awarded, a quarter of them were to new suppliers.

These signs of recovery for the UK public sector come after a steep decline in invitations to tender (ITTs), with numbers on the rise for the first time since February.

The breakdown of Covid-19 contracts includes 44 Department of Health contracts totalling £565m, five Department for Education contracts worth £297m, three Crown Commercial Service contracts worth £195m and one Environment Agency contract of £208m.

Accommodation and food, to support vulnerable adults and children is the largest contract area, worth £461m, followed by Testing (£421m) and PPE (£342m). Other notable contract areas are ventilators, IT and telecoms.

Advice for Government suppliers navigating Covid-19 is to expect disruption in current/future bids, look out for extensions to current contracts, use this time for strategic planning and to consider reaching out directly to public bodies if you think you can help, as direct awards are more likely at this time.

READ MORE: New procurement guidance to ease cash flow pressures on suppliers

READ MORE: Cabinet Office moves to further protect suppliers after coronavirus

Concluding the report, Tussell said:

“Central Government departments have been responsible for the vast majority of procurement, reflecting how the crisis response has been quite highly centralised.

"While this centralised approach in theory brings the benefits of economies of scale and harmonisation, in practice it may make it more difficult to respond to local situations on the ground.

“The public sector is not just turning to its existing supply chain to support its response to the crisis. A quarter of the contracts awarded so far have been to companies that have never before been named on a published UK public sector contract.

“Although hundreds of contracts have now been published, there are still gaps in the data. Nothing has yet been published relating to the government’s creation of the Nightingale field hospitals, nor about the companies involved in the human contact tracing programme.”

 

LISTEN: Ep. 15 Lord Kerslake - A gradual erosion of local autonomy

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