Monday 18 August 2014

Procurement in an Independent Scotland (part 1)

By Scott Farrance

This time next month (18th September to be precise) myself and my fellow Scots will be heading to the polls to vote on the future of Scotland; should we remain in union with the rest of the UK or strike out on our own?

There is, or certainly should be, only one question on the mind of all Procurement professionals in Scotland; what effect would Scottish Independence have on Public Sector Procurement? If Scotland achieves independence, how would this affect trade between Scotland and the rest of the UK?

70% of Scottish trade goes South of the Border to England, here at BravoSolution we are one example of the cross-border trade; a London company, a small team based in Glasgow, working for a Scottish Client. Yes the wages of the ‘lucky few’ who reside in Glasgow will remain in Scotland, but all fees to BravoSolution go back to London. Everything could be the status quo, but there are a couple of serious unknowns if it is a ‘Yes’ vote on the 18th of September.

There are two main uncertain factors of independence which relate directly to Procurement; EU Membership and Currency. I will be covering the issue of the EU in this Part and Part 2 will feature the meat in any country’s sandwich – what currency does it use.

Will a new independent Scotland have Automatic Membership of the EU? No-one knows for certain. The SNP have said they will, many political experts and indeed European Prime Ministers have said they won’t be.

If Scotland is not an immediate member of the EU, would this mean the EU Procurement Directives are effectively null and void in Scotland? Would buyers no longer be obliged to adhere to them? The Scottish Government could request people adhere to them, but if they are not in the EU, would this stance stand up in a court of law? If we are not in the EU, how would lawyers or law makers cite their laws? If you are caught carrying a weapon around Glasgow city centre, you cannot cite the American Second Amendment when in court.

Could this be why there’s a Procurement Reform Bill going through Holyrood at the same time? Is this in fact a ‘Regulatory Safety Net’ so to speak? If EU Regulations cannot be enforced, will they rely solely on the Reform Bill, or try and Mandate Scottish Regulations until they gain membership of the EU? As said, the Government could ask for them to be applied, but without EU Membership, people and organisations are not subject to their rulings and jurisdiction? Scotland regularly makes its own changes to EU reforms – this power is already devolved to Holyrood, but would they be wide ranging enough to cover an entire country and sector? How long would it take Scotland to write and put in place its own Directives if EU Membership became an issue?

Could you imagine the headaches for Contracting Authorities and Businesses if the rules which had governed them and their Suppliers no longer applied? The Scottish Government has put in a lot of work to ensure that Buyers follow these rules and that Suppliers (especially SMEs) benefit from Procurement Exercises run in a proper and appropriate fashion. All they could offer is ‘Best Practise’ advice if there is no Directive or Law to back it up. A lot for heads of organisations AND the Supplier community to think about...

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1 comment:

  1. Scott, a number of things. Scotland will absolutely not gain automatic entry into the EU. SNP want to be in the EU but don't want the Euro, how's that for a negotiation weakness. SNP want the UK pound but not be in the UK, you couldn't make it up. SNP also want to be in NATO, without providing much support, but that's for another day. Cake and eat it spring to mind.

    Regarding Best Practice v EU regulations and directives, no brainer, companies and suppliers would do just fine, swathes of lawyers and administrators maybe less so.

    I think you'll also find that Scot's Law is quite capable of addressing knife issues and our other laws of the land.