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Buying British shouldn't blind decision-makers to fairness

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legal matters

Last week I wrote about the extraordinary case of Harmon v House of Commons and the reprehensible treatment meted out to tenderers for the fenestration works to Portcullis House by the House of Commons. In breach of eu procurement regulations, the House of Commons favoured the British Seele/Alvis consortium over Harmon Facades' cheaper tender. Was this an exceptional one-off case or are there any lessons of general application to be learnt? Certainly it was an unusual case. The project sponsor, Andrew Makepeace, was a senior civil servant who operated through various committees but, ultimately it seems, was answerable to no-one. He placed the fenestration contract to Alvis, knowing that he was doing so in breach of the Public Works Contracts Regulations (pwr) and that it was unlawful and wrong. The judge found that he was not an honest or reasonable man. From time to time one comes across a case where the events suggest that something a bit rum was going on. My pupilmaster always said that if you have to choose between an explanation which involves conspiracy or one that can be attributed to mere incompetence, 99 per cent of the time it turns out to be incompetence. This case was the 1 per cent.

(Makepeace was not alone in finding himself at the wrong end of the judicial boot. The judge described Laing Management's project manager, Philip Brand, as 'teflon-man'. Even though Brand was actively involved in the project when he gave his evidence he could not remember anything of any relevance to the case. He was, in effect, 'non-stick'.)

The project team was in favour of going British if possible. The architect, Michael Hopkins & Partners, was clearly biased against Harmon, describing its vast manufacturing base in France as 'the big shed'. But is this a bad thing? One can debate the niceties of whether it is in the country's best interests to keep its building industry in business even if the product is more expensive for its taxpayers. Where projects are subject to the pwr there can be no question but that all tenderers should be treated equally, irrespective of nationality. In fact, even if a 'buy British' policy had been permissible, the project team faced the difficulty that few British companies produce curtain walling. Should Hopkins have thought about this when it designed the very tricky, welded metal facade?

The regulations are clear and, unlike many EU directives, pwr is assessable. They do not apply to all projects, only to contracts for public works and then for those in excess of £5 million. It is not always necessary, therefore, to go the eu procurement route. If the pwr do apply, they will give tenderers clear rights to be treated fairly and clear remedies in the event that they are not. The main wrong perpetrated against Harmon was that the project team favoured an alternative design (option B) submitted by Alvis as part of its tender, which Alvis put forward on a 'commercial in confidence basis'. Ultimately option B was not to be the answer to the design team's prayers, but even if it had been, Harmon was not given an opportunity to submit its own price for these works. Had Makepeace been minded to, he could have investigated with Alvis the cost of buying off the 'commercial in confidence' label: after all, it was paid for the design in the end. He did not do so, for the same reasons that he did not seek legal advice as to the propriety of his actions - he did not want to be thwarted in his objective of securing the job for Alvis. Perhaps the most salutary point arising from this is that Harmon only brought the case in the first place after it had received the explanation for the failure of its tender, which had been heavily doctored by Makepeace and his lawyers, and after it had been told by Laing's Ron Kerr that it should not take on the government if it ever wants to work in the uk again. Let that be a lesson to us all.

Kim Franklin

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