Procurement – will your procurements stand up to scrutiny?

Published: 3rd October 2008

In today's economic climate suppliers are more and more inclined to challenge a procurement process. A new case has clarified the thresholds to be overcome.

In Lettings International v Newham LBC the local authority had advertised its intention to enter into framework contracts and L tendered. When it didn't win, L decided to test the process and found it lacking on the basis that the local authority had failed to act in a fair and transparent manner when handling the tender process.

It was held:

• Newham had failed to act with the requisite degree of transparency in that it had failed to sufficiently disclose contract award criteria and weightings in advance by not setting out the detailed criteria and sub-criteria against which it actually marked the tenders. It had also failed to disclose the way in which those factors were weighted relative to each other. The requirement of transparency meant that all criteria used by a contracting authority had to be disclosed.
• Newham had failed to act with the degree of transparency required by failing to apply the disclosed criteria by only awarding three marks out of a possible five under each head for compliance with the specification and reserving the remaining marks for those which exceeded the specification. There was insufficient clarity on what "exceeding" meant. Discretionary marks are dangerous.
• L didn't even need to show it had suffered a loss, just that it had suffered the loss of a significant chance of obtaining the contract.

This case pushes the boundaries of previous compliance interpretations, especially with regard to the "discretionary marks" point. With many years public sector procurement experience, Mace & Jones is ideally placed to help.