My Lords, I shall speak also to Amendment 107 in this group. The large part of this group is government amendments, but my two small probing amendments have found their way into my noble friend’s rather large group.
Amendment 96 is another “may/must” amendment, which we always enjoy in this Committee. It probes the effect of not satisfying participation conditions on a tender. Clause 21 allows a contracting authority to set conditions of participation in specific areas. Subsection (6) permits but does not require the contracting
authority to exclude a supplier which does not satisfy a participation condition from then participating in all or part of the tendering process.
If a contracting authority does not exclude a supplier from the tender process, one might think that such a tender could result in the award of a contract. If that were not the case, I can see no reasonable case for allowing such a tender into the process at all. However, subsection (3)(a) of Clause 18, which deals with contract award, states that
“a contracting authority … must disregard any tender from a supplier that does not satisfy the conditions of participation”.
Hence, we seem to have an Alice in Wonderland world where a supplier which has fallen foul of participation provisions can take part in the tender process, but only on the strict understanding that it cannot win the contract. That does not make any sense to me. My amendment would make the terms of Clause 18 permissive, so that a contract could be awarded. Another solution would be to make exclusion mandatory from the tender as well as from the contract award.
My second amendment in this group, Amendment 107, is a simple probing amendment to ascertain what is meant by Clause 19(3), which deals with competitive tendering procedures. Subsection (3) requires the procedure to be proportionate,
“having regard to the nature, complexity and cost of the contract”,
which seems at first sight entirely sensible and should stop contracting authorities using unnecessarily burdensome procedures. What subsection (3) does not say, however, is how this is to be assessed.
In a rare case of going beyond what is in the Bill, the Explanatory Notes say:
“Subsection (3) requires contracting authorities to ensure that the procedure is not designed in a manner that is unnecessarily complex or burdensome for suppliers”.
This is, in fact, from paragraph 141 of the Explanatory Notes, not paragraph 142 as I set out in my explanatory statement. The Explanatory Notes therefore firmly place the consideration of proportionality in the context of suppliers, but that has not found its way into the text of Clause 19, and that is what my Amendment 107 seeks to change.
In addition, even if subsection (3) could be read as being a supplier-centred proportionality requirement, it does not give any help as to whether the contracting authority has to consider suppliers generally, in an objective way, or whether they should take account of the particular characteristics of likely suppliers. I have in mind in particular that what proportionality might look like to a multi-million-pound contracting business is light years away from its impact on a small or medium-sized enterprise.
I hope my noble friend will agree to make the Bill clearer in this regard, or at least make a clear statement from the Dispatch Box as to how Clause 19(3) is intended to be interpreted. I beg to move.