How to simplify public-sector procurement

Paul Reeve is director of CSR at ECA and chairs the Build UK CAS review group

In March, the Cabinet Office issued its long-awaited procurement policy note (PPN) 03/23. Significantly, this revised note now enables public-sector buyers to specify the Common Assessment Standard (CAS) when prequalifying suppliers for significant “public works contracts”.  Those familiar with the Public Contracts Regulations 2015 will know that “works” covers a comprehensive swathe of construction and maintenance activity. As such, the revised PPN means that more contractors operating in the public sector will need to engage with the CAS in future.

The CAS was introduced by Build UK, with widespread industry support, to cut the considerable cost and waste to buyers and suppliers that’s long been associated with industry prequalification questionnaires (PQQs). It comprises an industry-agreed question set and assessment standards, and its general ethos is to only ask questions needed to meet widely recognised assurance needs for stage 1 procurement, with various question exemptions for micro-businesses. Significantly, the CAS does not include project- or task-specific enquires, which are best covered by bespoke dialogue between buyers and suppliers. The supplier’s responses usually receive a “desktop” assessment by one of four recognised CAS assessors, although some suppliers are assessed with a site visit.

To date, active support for the CAS has come from a growing list of large construction buyers, along with various commercial clients, trade bodies such as the Electrical Contractors’ Association, and leading assessment providers, as well as the Cabinet Office, which has long been interested in its potential for the public sector.

The Common Assessment Standard or PAS 91?

PPN 03/23 finally adopts a recommendation in the 2021 report Constructing the Gold Standard, which was a review of public-sector frameworks by the Centre of Construction Law at King’s College, London. This independent review concluded that deploying the CAS would cut considerable waste of both the cost and time involved in public-sector prequalification. The result is a revised PPN that requires public-sector deployment of either the CAS or PAS 91 for works contracts above the public works threshold. These works contracts can include the procurement of mixed contracts for supplies and services, although they exclude NHS procurement.

“The CAS’s annual revision process allows the questions to be adjusted as necessary to reflect changing legislative and buyer assurance requirements”

So what about PAS 91? This was developed in 2010 as an initial stakeholder response to the unbridled proliferation of construction (and particularly health and safety) PQQs. A ground breaker, it’s been the basis for much of the progress with standardising PQQs since then. Yet while the public procurement days of PAS 91 are not over, they now look numbered. One reason is that the long PAS 91 revision cycle cannot cope with the pace of change in modern supply chain assurance, leaving many of the PAS 91 questions badly out of date.

In contrast, the CAS offers relative flexibility. Its annual revision process allows the questions to be adjusted as necessary to reflect changing legislative and buyer assurance requirements, while still offering industry and assessor consultation. To illustrate this, in 2022 Build UK released a mid-year update allowing the CAS to ask for supplier confirmation that they don’t do business with those on the UK Sanctions List.  Looking forward, the CAS is also expected to develop new questions and standards to cover supplier requirements under the new Building Safety regime.

As a result, it’s widely anticipated that public-sector bodies will increasingly opt to use the CAS rather than PAS 91 as the PQQ assessment of choice for substantial public works.

Building on initial support

The CAS is key to overcoming the time and cost burden of excessive and duplicated prequalification. Extending its specification into the public sector will add to the tier one contractors and other commercial buyers who already specify the CAS in construction. However, PPNs are not edicts but “statutory guidance”, so some parts of the public sector are likely to move faster than others. Even so, revised PPN 03/23 underlines the confidence that the CAS is what’s needed to prequalify suppliers across a broad spectrum of public-sector works. Looking forward, it will be interesting to see how the Crown Commercial Service will go on to incorporate it into the digitisation of public-sector procurement.