Leveraging eSourcing for Successful Public Procurement in a Post-Election Landscape

The general election has come and gone political parties are settling in and the Labour Party has announced that it’s determined to rescue the UK from the “chaos” of the previous government. To this end, the Labour Party has promised many reforms to rebuild, refresh, or revamp different industries, including housing, transport, and, importantly, public sector procurement.

We’re going to look at the impact the general elections had on procurement and the road ahead as envisioned by Labour.

Pre-Election Impact

There is a curious pre-election period (purdah) during which public procurement hangs in abeyance. It typically starts six weeks before the election date. During this time, no new decisions on policy matters are made nor are large commercial contracts awarded.

This is primarily to stop public sector authorities from making announcements that could affect the election’s results. It’s also possible that the new government might have a different approach to certain projects.

Post-Election Regulations

When public procurement starts again, all processes that preceded the implementation date will continue to be regulated by the Public Contracts Regulations 2015 (PCR 2015).

The new Procurement Act will regulate processes that start on or after the implementation date.

But, it’s not quite that simple. 

Take these examples, for instance

1) If contracting authorities are in the pre-market engagement stage just a few days or weeks before the Act is launched, but the tender notice is published on or after the Act comes into effect, they can explain the outcome of the engagement on the tender notice without going through the entire process again. They can do this via any Prior Information Notice regulated by the PCR 2015.

2) Non-competitive contracts that are signed less than three months after implementation will fall under the PCR 2015. Contracts signed more than three months after implementation will fall under the Procurement Act 2023.

3) Contracts that kick in before the implementation date will fall under the PCR 2015 for the duration of the contract. The duration here includes extensions and modifications. This means a contract may remain under the PCR 2015 for the next four, five, maybe even 10 years.

Frameworks and Dynamic Purchasing Systems (DPS) get the same treatment. Contracts called off before the Procurement Act is implemented remain under PCR 2015 for the entire contract duration.

UK General Election Spending Limits

Political party campaigns and individual candidate campaigns have set spending limits in the run up to the poll. The Electoral Commission regulates party spending, from money spent on the littlest leaflets to funds raised for the snappiest broadcasts.

Local council officials ensure candidates in each constituency stick to their spending limits. 

What are the spending limits for political parties?

First, spending limits start a full calendar year before the election date. 

Political parties are limited to just over £54,000 per constituency. Should a party stand for all the constituencies in Great Britain, their limit is £34 million.

However, it’s not really quite as simple as that. For example, parties in England are free to spend just over £1.4 million regardless of how many seats they’re after.

It gets more complicated when it comes to individual candidates. Their spending is divided between two campaign periods: short and long. Spending in these periods is in addition to party spending limits.

Here’s a quick look at the difference between short and long political campaigns.

Short campaigns: The period begins from the date parliament is dissolved – so about six weeks before the election date.

Spending on short campaigns is in addition to spending on long campaigns – which ends when parliament is dissolved.

Long campaigns: The period begins 55 months after parliament sits for the first time.

Should parties spend money in excess of the limits, they can be fined up to £20,000.

Total Election Cost

According to an article in the Guardian, the July 2024 general election is estimated to be the most expensive on record – well, at least since expenses were regulated in 2000.

When adjusted for today’s terms, the most expensive election ever was in 1880, when spending hit £170 million. Granted, it might not have been as free and fair as today’s elections and the results might have been swayed by corruption, but it’s still incredibly impressive.

Now, 140 years later, corruption still rears its ugly head, but at least there is a reasonable cap on spending so that amounts don’t spiral out of control.

Where do candidates’ funds come from?

Donations are the primary source of funds. Here’s a quick look at the regulations governing business and individual contributors.

Donations come from …

Election contributions are regulated by the Political Parties, Elections, and Referendums Act 2000 (PPERA). The Act states that donations to political parties that are higher than £500 must come from “permissible sources.”

Contributions to individual candidates that are more than £50 must also come from permissible sources.

This begs the question: What is a permissible source?

The Electoral Commission provides a list of permissible sources, some of which include:

1. Individual contributors on an electoral register in the UK (includes contributions from voters overseas).
2. A political party that is registered in Great Britain.
3. UK-registered trade unions
4. UK-registered friendly society

Political party funding and funding for individual candidates can also come from UK-based unincorporated associations that conduct business mainly in the UK. They can contribute to political parties provided their head office is in the UK.

The important thing is that donations aren’t capped. There is no limit to the amount of money permissible sources can donate.

What Will The Labour Party Focus On Post-Election?

Labour has announced five national missions intended to grow the UK’s economy.

1. Implement tough spending rules to improve economic stability.
2. Develop partnerships with business sectors to boost overall growth.
3. Create a National Wealth Fund to address skills and labour shortages.
4. Reform planning in the housing sector to build 1.5 million new homes during Labour’s term in parliament.
5. Devolution of power in England.

It has also pinpointed sectors that are likely to receive a public funding injection during its term in Parliament, including:

1. Infrastructure: £2.5 billion to rebuild our steel industry.
2. Defence: Improve accommodation for armed forces and establish an armed forces commissioner responsible for improving service life.
3. Green initiatives: £1 billion to accelerate the deployment of carbon capture and £500 million to support the manufacturing of green hydrogen
4. Housing: Job creation via the housing plan (1.5 million homes)
5. Transport:  £1.8 billion to upgrade ports and build supply chains across the UK
6. Procurement: Simplify the procurement process to support innovation
7. Healthcare: Expand NHS workforce, for example, recruit 8500 mental health staff
8. Technology: Industrial strategy supports the development of the AI sector
9. Education: Recruit 6500 more teachers in key subjects, like maths

There is specific mention that procurement and trade policy will be aligned with industrial strategy priorities.

Delta eSourcing: A Guiding Light

If you’re a bit worried about how the general elections will impact you, especially regarding procurement, contact Delta eSourcing.

Our public procurement experts can walk you through pertinent information, so you can once again navigate the public sector procurement market with confidence.