The Department for Education has no immediate plans to cancel or reprocure the Education Funding Agency’s controversial £5bn Regional Framework, despite assurances to the contraty from a government minister
The news will come as a blow to hundreds of SMEs who feel they have been frozen out of the framework because of “unnecessarily high” bidding requirements.
Before May’s general election, then Cabinet Office minister Francis Maude told the National Federation of Builders the framework would be put back out to tender after the department’s ‘mystery shopper’ found that it had not complied with government procurement policy.
But a DfE spokesman this week told Construction News that the department was ‘not looking to reprocure the Regional Framework at this stage’.
Construction News understands that post-election meetings had been scheduled between the NFB and both the EFA and the Crown Commercial Service to discuss the issue, but that these were later postponed.
NFB head of policy and research Paul Bogle said his organisation believed that a decision to scrap the framework had been made by Maude and would be honoured.
‘To me and several other people in that room, the decision seemed quite clear,” he told Construction News when asked about the April meeting.
‘This effectively freezes people out of the framework for years to come because of a non-compliant process.’
The EFA went to the market for the six regional lots in its framework in 2013, setting out criteria that included a requirement for bidding contractors to have a minimum turnover of £25m in each region they bid for.
Contractors bidding as part of consortia were required to have a minimum turnover of £10m in each region.
In July 2014, 16 contractors were selected to fill the 43 places across the six panels, with the four-year framework including school-building jobs worth between £200,000 and £12m.
The majority of those firms selected were major national contractors, with Bam Construction and Kier winning a place on all six regional rosters.
Only two of the 16 firms had a turnover of less than £100m.
The mystery shopper report by the Cabinet Office, which has oversight of procurement issues for the government, raised concerns about the inclusion of a minimum turnover threshold.
The report said the mystery shopper pointed the EFA to guidance “which advises against the use of excluding bidders solely on the basis of turnover”.
It added that the EFA had accepted the advice and ‘would apply this policy in future procurements’.
Earlier this year, the government faced calls to ditch the framework after a report compiled by the NFB and architectural group Project Compass claimed it was anti-competitive and ran ‘contrary to government advice’.
Speaking this week about the DfE’s apparent decision to keep the framework, Project Compass director Walter Menteth said he hoped the new government would ‘follow through’ with its commitment to reforming procurement.
Menteth added that ‘rightly so, there would likely be uproar’ among smaller contractors at the decision to stick with the framework.
‘In terms of the spread of who has got the jobs, it’s unparalleled that the small national procurement framework should be swept up by the large contractors as well. What’s the point in having it?
‘The economic issues here about expanding business enhancing opportunities and improving performance are critical.’