What are Public Contracts Regulations?
All public sector contracts for goods, services or works by public sector bodies are subject to UK procurement rules known as The Public Contracts Regulations. These apply where the value of a contract is over the financial threshold stated in those Regulations.
The purpose of this procurement legislation is to open up public procurement to UK-wide competition. It is intended to make sure that all potential bidders are treated equally; with contracts awarded fairly, transparently and without discrimination.
The Regulations require all public sector bodies wanting to make a purchase over the relevant threshold to advertise the opportunity in the Find a Tender and Contracts Finder websites, and to follow the procedural rules for how the procurement must be conducted.
All of ESPO’s frameworks are compliant with these Public Contract Regulations.
What is a framework?
The Public Contracts Regulations 2015 define a framework agreement as:
"An agreement between one or more contracting authorities and one or more economic operators, the purpose of which is to establish the terms governing contracts to be awarded during a given period, in particular with regard to price and, where appropriate, the quantity envisaged."
The Regulations apply when public authorities look to purchase goods, services or works. The framework agreement may, itself, be a contract to which the UK procurement rules apply. Alternatively, it may be a simple agreement under which contracts are only formed when goods, services or works are called off.
Using an ESPO framework ensures that the buying process is fully compliant with UK procurement legislation and all suppliers listed on our frameworks have been assessed during the procurement process for their financial stability, track record, experience and professional ability.
What are the procurement routes for ESPO frameworks?
ESPO frameworks can take several forms with regards to how you can access them. These are referred to as call-off and further competition.
These frameworks are sometimes referred to as direct award and are often the quickest way to procure goods/services via a framework. This method is available on frameworks where goods or services can be easily defined and priced, which means you can place an order directly with the supplier that best meets your needs.
Further competition frameworks
These frameworks provide specific goods or services that may vary from one customer to another, which makes it difficult to pre-define requirements and provide pricing. These frameworks are structured to allow customers to outline their own specific requirements and run a further competition – evaluating against certain criteria - to identify the best solution.
There are also frameworks that include both call-off and further competition options. In these cases, if the solutions meet your needs you can choose place a direct award, or you can run a further competition if it is more appropriate.
Why are they called Frameworks rather than contracts?
Frameworks are often referred to as ‘contracts’, however this isn’t quite right. Legal definitions vary, but in essence a contract is a legally binding agreement between two parties which commits them to exchanging goods or services in return for payment.
Frameworks are different, as they do not normally include a legally binding commitment on the customer to receive the goods or services and make payment. Only when a customer places an order under the terms of the framework does it become a contract between the customer and the supplier.
What makes ESPO able to create compliant frameworks?
The Public Contracts Regulations 2015 permit contracting authorities, such as ESPO, to establish framework agreements by applying the procedures provided in the Regulations.
These framework agreements establish the terms that govern contracts. Contracting authorities can then award under a given framework provided that they are clearly identified for that purpose, and that they follow the award procedures laid down in that framework and the Regulations.
Can I have a copy of a previous version of a User Guide?
Our framework User Guides often have many different versions and we always make the most recent iteration available on our website. However, there may be times when you require a previous version to refer back to.
If you need a copy of a previous version, please get in touch using the listed contact on the relevant framework page.
How long can I call off a contract for?
The length of call-offs under framework agreements are not specifically limited by the Public Contract Regulations 2015 ('The Regulations'). The length of call-offs, as with other contracts, should be appropriate to the purchases in question and should reflect value for money considerations. Call-off contracts based on framework agreements may be longer than four years, and may extend beyond the expiry date of the framework.
So, while it is possible for call-off contracts to outlive the over-arching framework agreements they are let under, you should consider how long the framework has been running when deciding on the duration of the contract you are about to let.
For example, you are able to let a contract on the last day of a framework, but to set the duration of this contract at four years would be riskier that to let the same contract for a shorter period of two years. A challenger may claim that a period of four years could restrict competition in the market - a move which may be argued is in breach of the Regulations. It would be much more difficult for the challenger to argue this point if the four-year contract had been let earlier in the life of the framework.
Generally speaking, the longer the contract, the greater the risk that a challenger may claim that the impact of the length is anti-competitive. Contracts of more than four years may be let where this can be justified on the grounds of implementation time and costs, or on economic grounds.
Examples of contracts that may be allowed for more than four years are:
- A banking contract where a public body may face costs associated to change-over and significant time would be needed for implementation, disruption of service etc.
- On economic grounds certain capital purchases may have timescales associated with repayment. This may be true for a Refuse Collection Vehicle (RCV) where the capital costs would typically be recovered over seven years. In these cases, a public body would justify the length of a seven-year call-off on the grounds of the time taken for the contractor to pay back the original capital cost of the vehicle.
It is very important that you record evidence for your reasoning to let a contract of more than four years and the corporate governance approvals around the decision, should another supplier in the market challenge your decision.
How long does it take to run a further competition?
There are no set time periods in the Public Contract Regulations 2015 that you need to comply with. Generally speaking, you should allow suppliers a reasonable amount of time to prepare and submit their bids.
This time should be longer where requirements are more complex, further clarification might be needed, or during particularly busy periods for suppliers. You should also allow some time before Invitations to Tender are issued to discuss requirements with suppliers, as well as time after award for implementation.
Why use ESPO frameworks?
Frameworks can be a particularly helpful and effective way for public sector organisations to buy goods and services. Whether they purchase on a periodic or regular basis, frameworks can considerably reduce the amount of time normally required by organisations to run a procurement exercise, while also ensuring they stay compliant with relevant legislations.
As our frameworks are accessed by many organisations as we are able to aggregate requirements to achieve economies of scale for our customers - our frameworks can save time and money while providing valuable access to procurement expertise, free templates, and useful guides to support organisations as much as they need.
Can I add my incumbent supplier to an ESPO further competition?
When running a further competition on a framework, only suppliers awarded within the specific Lot(s) can be invited to submit a tender. It is worth checking whether your incumbent supplier is awarded within the relevant Lot before you start the process, this is because suppliers not already listed can’t be added or awarded work via the framework.
Do I have to use ESPO’s Terms & Conditions?
When ESPO establishes or renews framework agreements, the Terms and Conditions are checked for suitability to make sure they are fit for purpose. In order for organisations to use a framework, you will need to use the ESPO call-off terms.
If you are considering an addition or amendment to these call-off terms you are responsible for determining whether those changes comply with the Public Contract Regulations 2015, so we recommend seeking advice from your legal advisors before you do this.
Do I have to invite all framework suppliers to a further competition?
When running a further competition via an ESPO framework you must invite all suppliers awarded within the specific Lot(s). All relevant suppliers must be given an equal opportunity to submit a tender, so this means you can’t pick and choose certain suppliers when conducting your procurement via this route.
Can I run further competitions electronically?
Yes, if you are a user of the ‘Proactis ProContract’ eProcurement system, you can now access ESPO’s frameworks through the system to run further competitions; allowing you to run your processes more quickly, simply and at lower risk of error.
We have created a useful guide to help you navigate creating a further competition on ProContract here. If you require additional help, you can contact us on firstname.lastname@example.org and one of the team will be happy to assist you further.