Scotland business

Scottish ministers publish Procurement Reform Bill

Image caption The reforms could allow public sector bodies to take blacklisting into account when awarding contracts

Public sector bodies could be allowed to consider issues such as blacklisting and zero-hours contracts when awarding work to firms, according to planned reforms.

The move is among changes to public procurement rules being proposed by the Scottish government.

The Procurement Reform Bill aims to improve the way the public sector buys goods, works and services.

Ministers said it would make it easier for small firms to bid for contracts.

Guidance under the bill would allow public sector bosses to consider the inappropriateness of awarding contracts to companies using controversial zero-hours contracts, which allow employers to hire staff with no guarantee of work.

Public sector bosses could also consider, when deciding on a contract award, whether firms use blacklisting.

The issue of blacklisting has angered unions and politicians, following disclosures about a UK-wide database of names used by major construction firms to vet workers.

'Socially responsible'

Deputy First Minister Nicola Sturgeon said the legislation promoted an approach that was "both business friendly and socially responsible".

The proposed new rules could also lead to greater use of community benefit clauses.

These clauses could require companies to provide training, apprenticeships or opportunities for disabled people as part of the contract.

"Changes to public procurement rules will ensure Scotland retains its place as a world leader in public procurement reform, promoting an approach that is both business friendly and socially responsible," Ms Sturgeon said.

Responding to the bill, Scottish Trades Union Congress general secretary Grahame Smith said: "The STUC enthusiastically welcomes parts of this important bill, especially its provisions to disqualify firms engaging in tax avoidance and blacklisting from the public procurement process and the commitment to introduce further guidance on workforce matters."

But Mr Smith described parts of the legislation as "very disappointing", adding: "It is difficult to believe that community benefits will be extended and improved by simply handing contracting authorities a duty to 'consider' whether to impose as part of the contract.

"The STUC is also sceptical that the significant additional requirements placed on local authorities and other contracting agencies will have 'no overall net impact on costs'."

Better value

Scottish Building Federation managing director Vaughan Hart welcomed the publication of the bill.

He said: "With a growing pipeline of publicly funded infrastructure projects planned over the years ahead, this bill offers the potential to transform the efficiency of public procurement - and to encourage many more particularly smaller building companies to bid for public sector contracts.

"We will look forward to scrutinising the detail in the months ahead."

CBI Scotland said the bill contained "a number of encouraging measures", but added that ministers risked missing out on an opportunity to open up the delivery of public services to independent providers.

Assistant director David Lonsdale added: "The bill should enshrine in legislation a 'right to bid' for private and third sector organisations, so that any provider who can demonstrate the capacity and wherewithal to deliver a public service more effectively, innovatively, and for better value is given the opportunity to do so."

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