Compulsory Competitive Tendering (Hansard, 2 June 1997)

§ Mr. Ron Davies

I have considered representations about the continuing difficulties that local authorities in Wales are facing in preparing for the reintroduction of Compulsory Competitive Tendering (CCT) given the pressures of reorganisation. I am of the view that I should take action to relieve these difficulties.

I intend to consult widely on a range of measures which I have in mind to achieve this objective while maintaining the pressure on local authorities to secure efficiencies in the delivery of services.

I propose to extend the moratorium on CCT until 1 October 1998.

Under the terms of the current moratorium, CCT has been generally suspended for work subject to the Local Government, Planning and Land Act 1980 (the 1980 Act) and for activities covered by the Local Government Act 1988 (the 1988 Act). Throughout the moratorium period, CCT has continued to apply to works of construction under the 1980 Act where the value of the work exceeds £500,000. Under my proposals this requirement will continue to apply during the extended moratorium.

I will also continue to require local authorities to produce annual reports and to meet the financial objective specified under current CCT legislation (the 1980 and 1988 Acts) where work is carried out in-house during the 33W extended moratorium. My Department will continue to monitor authorities' performance throughout the extended moratorium and will take appropriate action if authorities fail to submit reports or achieve the financial objective.

Under my proposals, on which I shall be consulting, CCT would be reintroduced from October 1998 for further elements of work covered by the 1980 Act. The purpose would be to extend the range of work beyond those large construction contracts which were subject to CCT under the terms of the moratorium. CCT for the remainder of work subject to the 1980 Act, and all activities subject to the 1988 Act, would be implemented on a phased and manageable basis during 1999.

With colleagues, I will be reviewing the existing CCT framework and will reassess the arrangements proposed for Wales in the light of the outcome of that review.

Our Manifesto gave a commitment to replace CCT with a duty on local authorities to achieve best value. While work on this is taken forward, I will encourage local authorities to take a positive view on the value of competitive tendering and to conclude properly those tendering exercises which are nearing completion.

I will also ask the Welsh Local Government Association to work with my Department, the Audit Commission and other Government Departments to develop a framework for piloting important features of a best value regime in advance of its formal introduction on a statutory basis.