New Procurement Regulations Implemented

The Governor has recently approved the new Procurement Regulations which replace the Contract Regulations 2006.

The new Procurement Regulations have introduced a number of new concepts that reflect a more modern procurement approach and are therefore significantly different to the old Contract Regulations, the main changes being:

•The threshold before the regulations apply has risen to £5,000. A number of other thresholds have also risen to reflect the fact that global prices have risen since the previous regulations were published.
•All procurements above £5,000 must be on a Rolling Procurement Plan before any procurement activity can take place. The Rolling Procurement Plan will be published on the SHG Website to ensure suppliers have increased visibility of upcoming procurement opportunities.
•The main procurement decisions with SHG will be based on risk and not value to ensure appropriate scrutiny of higher risk procurements whilst allowing the routine ones to proceed quicker and with less bureaucracy.
•Procurement Services (the old Central Procurement Unit) will play a much greater role in any Procurement classified as Medium or High risk. This will focus procurement skill and expertise where it is required.
•The main procurement decisions will now take place before the procurement commences to ensure appropriate scrutiny and control of what is to be purchased rather than at the end of the process when it is normally too late to affect the decision.
•The Contract Award process is significantly simplified provided the tenders/quotations are within the boundaries agreed at the commencement stage.
•Tender Board will be replaced by a Procurement Board with a significantly different Terms of Reference to focus on strategic decisions and not on process.
•To ensure greater transparency in the decision making process all waivers to the Regulations and a register of SHG Contracts above £5,000 will be published on the SHG website.

As with all major changes the new regulations have been subject to a phased implementation over the past two months, this has allowed approximately 100 SHG staff to be trained in the new Regulations and the Tender Board to complete its business.

The new Regulations will come into full effect on 1 October 2013. However, until the recruitment of the Head of Procurement Services and a number of other organisational changes are implemented there may be some deviation from the regulations regarding who in SHG conducts the procurement in order to ensure capacity constraints do not significantly impact service delivery.

Copies of the new Procurement Regulations, Terms of Reference for the Procurement Board and process maps which will hopefully help guide people through the new processes, can be found on the SHG website, via email from the Financial Secretary on or by visiting Corporate Procurement at the Castle.

Further, officers within Finance and Corporate Procurement will be happy to discuss the new regulations with any interested parties, so please feel free to contact them via the Castle receptionist on telephone number 2470.

30 September 2013


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