Dear Vice-Chancellor or Principal
1. This letter requires all HEFCE-funded higher education institutions to report the contracts they have awarded in the calendar year 2011, in accordance with the European Union’s (EU’s) Directives on Public Procurement. The deadline for return of information is Friday 27 July 2012. This is an annual reporting exercise; the previous one was HEFCE 2011/19.
2. These EU Directives were implemented into national law in the UK by the Public Contracts Regulations (PCR) 2006 (www.legislation.gov.uk/uksi/2006/5/contents/made). Under the PCR, institutions must ensure that contracts in excess of the relevant financial thresholds are advertised throughout the EU, in the Official Journal of the European Union (OJEU). They must also provide information about expenditure on procurement.
3. More recently new Defence and Security Public Contracts Regulations (DSPCR) came into force. From 21 August 2011, the majority of defence and sensitive security procurements are expected to be opened to competition through OJEU. Under the DSPCR all procurers within the meaning of Regulation 4 (Contracting authorities) are required to prepare records, provide statistics and draw up reports as outlined in Regulations 33 (12 – 14), 46 and 47.
4. The Department for Business, Innovation and Skills (BIS) is responsible for gathering statistical returns from the further and higher education sectors. These returns are then submitted to the Cabinet Office. BIS has asked us to collect information for HEFCE-funded higher education institutions for calendar year 2011.
5. The information required is set out in Annex 2 of Procurement Policy Note (PPN) 05/12, ‘EU Statistics on public procurement – annual return for calendar year 2011’, issued by the Cabinet Office. In previous years HEFCE has set out the requirements in a publication but this year, to streamline the process, we are providing a link directly to the relevant PPN page of the Cabinet Office web-site: www.cabinetoffice.gov.uk/resource-library/procurement-policy-notes-0512-0612-annual-eu-statistical-data-collection-2011.
6. Below PPN 05/12 on that web page are three other documents. The first one, ‘Public Procurement and DSPCR Annual EU Statistical Return Form for 2011’, should be downloaded for completion (see paragraph 13). The other two should be disregarded.
Public Contracts Regulations 2006
7. As in previous years, information is required for each contract or framework agreement awarded under the PCR during calendar year 2011, provided that the estimated value is above the threshold of the regulations (or is otherwise caught by the aggregation rules) and that it does not fall within the scope of one of the specified exemptions contained within the PCR. This is a legal requirement, not a matter of discretion. Information is not required on contracts ‘called off’ from framework agreements: it is information about the framework agreements themselves which is required.
8. The EU procurement thresholds applicable in 2011 are set out in Annex 2 of PPN 05/12.
Defence and Security Public Contracts Regulations 2011
9. PPN 05/12 contains a section about the new Defence and Security Public Contracts Regulations 2011 (www.legislation.gov.uk/uksi/2011/1848/made). The DSPCR implement the new EU Defence and Security Procurement Directive. They came into force on 21 August 2011, and apply to procurement procedures beginning on or after that date.
10. As stated in paragraph 6 of the DSPCR, the new regulations cover specific contracts in the fields of defence and security for the procurement of:
- The supply of military equipment, including any parts, components or subassemblies of military equipment;
- The supply of sensitive equipment, including any parts, components or subassemblies of military equipment;
- Work, works, goods or services directly related to equipment referred in sub paragraph (a) or (b) for any and all elements of its life cycle;
- Work, works or services for specifically military purposes; or
- Sensitive work or works or sensitive services.
11. Our expectation is that the DSPCR will apply predominantly to Ministry of Defence contracts. However, the regulations are applicable to all contracting authorities and it is conceivable that on occasion higher education institutions will procure under these regulations.
12. As with the PCR, DSPCR statistical information is required in respect of each contract or framework agreement awarded during calendar year 2011, provided that the estimated value is above the threshold of the regulations and that it does not fall within the scope of one of the specified exemptions contained within the regulations. Again, this is a legal requirement, not a matter of discretion.
Completing the PCR and DSPCR return
13. Returns must be made on the EU Statistics Return 2011 workbook, ‘Public Procurement and DSPCR Annual EU Statistical Return Form for 2011’, which is available to download below PPN 05/12 on the Cabinet Office web-site (see link at the end of paragraph 6). The form should be downloaded and saved before being completed and submitted: it cannot be completed online.
14. Additional points to note are:
a. Higher education institutions are not bodies covered by Schedule 1 to the Public Supply Contracts Regulations, and are therefore not required to provide the overall value of contracts below the threshold of each of the regulations.
b. As stated in paragraph 14 of PPN 05/12, compliance cost information is required for calendar year 2011, and institutions are requested to provide this information on the third sheet of the EU Statistics Return 2011 workbook.
c. The Public Procurement and DSPCR Annual EU Statistical Return Form should be used to report any contracts awarded under the DSPCR as well as those awarded under the PCR:
i. Please list firstly any contracts awarded under the PCR. If no PCR contracts have been awarded, please state ‘PCR – nil return’.
ii. Then list separately any contracts awarded under the DSPCR. If no DSPCR contracts have been awarded, please state ‘DSPCR – nil return’.
15. Even where both are nil returns, institutions should complete and return the workbook.
Submitting the PCR and DSPCR return
16. Completed survey forms should be returned by e-mail to HEFCE (EUstatistics@hefce.ac.uk) by Friday 27 July 2012. Please return the entire workbook. Do not send the form to the Cabinet Office.
Sir Alan Langlands