HC Deb 02 April 1996 vol 275 cc172-4W
Mr. Elletson

To ask the Secretary of State for the Environment when he will issue the new guidance on the conduct of compulsory competitive tendering; and if he will make a statement. [24586]

Sir Paul Beresford

Following consultation on the draft guidance, issued on 15 October 1995, we have today published a new departmental circular No. 5/96—Welsh Office No. 11/96—which provides guidance on the conduct of compulsory competitive tendering.

The Department received 222 responses to the consultation exercise. Of these, 162—or 73 per cent.—were from local authorities and related organisations. Thirty-two—or 15 per cent.—were received from contractors and trade associations. Police and fire authorities submitted 12—or 5 per cent.—of the responses and there were 16—or 7 per cent.—other responses. A further 15 responses were received by the Welsh Office and 45 by the Scottish Office, in both cases predominantly from local authorities. I have today placed a list of responses in the Library of the House. Copies of the responses are held in the Department's library.

Respondents broadly welcomed the move away from detailed emphasis on anti-competitive behaviour practices as set out in DOE circular 10/93—Welsh Office circular 40/93.

The new guidance identifies five principles for good tendering practice which local authorities are required to apply in subjecting work to compulsory competitive tendering. These stress the need for transparency and fairness as between potential contractors, and for key decisions to be informed by market conditions.

Local authorities are expected to provide clear account of the way in which key strategic decisions affecting the tendering process have been taken. The guidance also encourages authorities to provide reports to appropriate committees at key stages. These reports should explain the way in which strategic decisions are compatible with authorities' duty to avoid acting anti-competitively.

The circular makes clear that local authorities should consult, where appropriate, a range of suppliers and professional bodies before making decisions about the way in which work is selected and packaged for competition. Authorities will satisfy the provisions of the legislation only where they have taken steps to ensure that their tendering practices are consistent with securing a good market response.

The remaining principles encourage the adoption of output, rather than input, based specifications for services, require clear procedures for evaluating tenders to ensure that quality can be achieved and seek to ensure that the conduct of tendering between external contractors and in-house teams does not put any one of them at a disadvantage.

CCT has proved itself in delivering on price and quality. Average savings of 6.5 per cent. have been achieved and the same or higher standards have been adopted in the overwhelming majority of cases. I intend that the benefits of competition are made available to all local taxpayers.

The new guidance applies immediately to those services currently subject to competition. The Secretary of State will take into account the extent to which there has been a contravention of the guidance in determining whether authorities have acted anti-competitively.