PPN 11/20 (PCR 2015)

Reserving below threshold procurements

In: Define > Sourcing strategy

Overview

This PPN applies to all central government departments, their executive agencies and non-departmental public bodies (collectively referred to as ‘in-scope organisations’). It is relevant only where Part 2 of the Public Contracts Regulations 2015 (PCR 2015) would have otherwise applied to the award of the contract because the estimated value of the procurement is less than the relevant threshold applicable under PCR 2015.

PPN 11/20 and its associated guidance covers options available to in-scope organisations when procuring contracts for goods, services and works below relevant thresholds; provided for in PCR 2015. Other contracting authorities may apply the principles outlined in this PPN; application of which should be considered in light of the authorities’ relevant legal obligations. There are also exceptions to the application of the policy, to certain procurements which involve the provision of goods into Northern Ireland.

In-scope organisations may consider, where appropriate, options for the procurement of below threshold contracts, including: reserving the procurement by supplier location (UK-wide, by county or borough for London), and reserving the procurement for small and medium-sized enterprises (SMEs) and voluntary, community and social enterprises (VCSEs). In this context location means where the supplier is based or established and has substantive business operations rather than the location of corporate ownership.

The reservation for SMEs and VCSEs cannot be applied independently of the location reservation, which must always apply when reserving under this policy.

Objective at this commercial stage

When developing its sourcing strategy in-scope organisations should test the market in terms of:

  • whether the market would support reserving the contract for a specific location (UK-wide, county, borough)
  • whether the market would support reserving the contract to SMEs or VCSEs, or
  • whether the market would support competing the contract on an open basis, without reservation.

Key considerations at this commercial stage

In-scope organisations should:

  • based on the market assessment, determine whether it would be appropriate to reserve below-threshold contracts by locations and in addition by supplier type, or whether tendering on an open basis would be more appropriate
  • keep appropriate records of all commercial decisions taken in connection with reserving below-threshold procurements
  • where a below-threshold contract is reserved, ensure final approval is obtained at an appropriate commercial level(s) within the organisation.

The PPN should be read alongside the relevant parts of the legal framework, including but not limited to, the following provisions of the Public Contracts Regulations 2015 (which may be particularly relevant to the consideration of this PPN):

  • Chapter 8: Below threshold procurements
  • Regulation 109: Scope of Chapter 8
  • Regulation 110: Publication of contract opportunities on Contracts Finder
  • Regulation 112: Publication of information on Contracts Finder about contracts awarded

Additional support and guidance

Make sure you:

  • read the PPN and any supporting implementation guidance
  • seek legal and commercial advice in the context of specific procurements