Why should you sweat the (seemingly) small stuff?
What are contract standing orders and why are they so important? Deepak Parmar explains.
What are Contract Standing Orders?
Contract Standing Orders (‘CSOs’) are a requirement in accordance with section 135 of the Local Government Act 1972 and form part of the overall constitution of a council.
The purpose of CSOs is to set out clear rules on how councils spend money on works, goods and services contracts. These rules are applicable to all contractual arrangements and cover all employees.
The CSOs will also set out a range of other obligations on how to deal with frameworks, choosing procurement procedures, evaluation criteria and contract extensions.
Decisions on implementing obligations found within CSOs must be made in accordance with any delegated authority powers.
Why is it so important?
Councils fall under the definition of a best value authority in accordance with section 1 of the Local Government Act 1999 and therefore are subjected to the best value duty which can be found in section 3 of the Local Government Act 1999. The duty sets the requirement to securing continuous improvement by having regard to a combination of economy, efficiency and effectiveness.
Therefore, the best value duty must be embedded throughout the constitution of a council and CSOs are an example of this duty.
The obligations within the CSOs are to work harmoniously with other pieces of legislation.
The CSOs are a live document which should be reviewed from time to time to ensure it reflects any updates to legislation as well as any procurement policy notes, which are issued by the government.
How up to date are you?
The new Procurement Act 2023 (‘Act’) is coming into force on 24 February 2025 and CSOs should be updated to align with the new requirements of the Act, and many councils’ CSOs have been drafted to reflect the Public Contracts Regulations 2015.
The Act brings several changes, including but not limited to:
- introduction of a competitive flexible procedure
- an expanded notice regime to increase transparency
- use of the central digital platform
- open frameworks which can last up to eight years
- refocused procurement objectives
- KPI and reporting requirements
- further grounds for direct awards based on the need to protect human, animal or plant life, health, public order and safety.
Failure to change?
Where CSOs have not been updated in line with new or updated legislation and a conflict occurs, this can present a difficult and challenging situation for council officers on which rules to follow, although of course most officers are not legally qualified and thus are likely to follow the standing orders without being aware of any conflicts. Decisions and actions of officers will generally be deemed to be those of the council.
Legislation will always take precedence over internal CSOs, and it would not be a defence to any claim that you have not acted in accordance with the legislation to say that you have acted in compliance with the CSOs.
However, not following the CSOs would present a further issue for councils and council officers Essentially, not following legislation or not following the standing orders is in any way desirable; put another way, the standing orders should accord with legislation.
It is therefore imperative that councils make changes to their CSOs to reflect the changes to the new Act.
Deepak Parmar is a Principal Associate at Weightmans.
