Further reflections on the ventilator saga

One of the benefits of blogging is the opportunity to get feedback quickly from your ideas so that you can reflect upon and refine them. A couple of days ago, Albert was kind enough to address my criticism of the Dyson ventilator contract and that poked me in a good way to sharpen my take on the matter.

I have three main qualms with the Dyson contract direct award. First, that the Government did not act upon earlier and thus created the situation of extreme urgency by its own (in)action. Second, that the Commission JPA for ventilators provides us with the counterfactual of what could have been done differently. Third, that the Dyson contract is not for the immediate supply of ventilators and as such it could not have been awarded directly. Albert and I agree on the third, so our differences are mostly in the first two and that's where I will focus this post.

In the meanwhile, let's not forget what is at stake here, since the price for 10,000 ventilators lies somewhere between £50-250M.

1. Extreme urgency due to Government (in)action

One of the interesting points about the whole ventilator saga is that the in this particular instance, the UK Government *is* the contracting authority and as such all its actions (or lack of them) are to be taken into account when assessing the grounds for extreme urgency for the purposes of Regulation 32. We do not know the details of the contract, but it is safe to assume it was either entered into by the Cabinet Office or the Department for Health. In my view, it is irrelevant which one actually entered into the contract as *neither* acted upon the need for ventilators until March 16th. For me, this is the crucial fault with the Government approach, ie the lack of action on ventilators since the end of January/beginning of February.

Albert contends that the decisions taken by the Government, especially the one not to join the JPA, are political in nature and thus not reviewable. My take on this argument is that the qualification of the nature of the decision(s) is irrelevant when assessing the extreme urgency test. Regulation 32(2)c and Article 32(2)c of the Directive do not distinguish what types of actions are to be assessed. As the negotiated procedure without prior publication of notice (or direct award) is an exceptional procedure, its grounds are to be interpreted narrowly, meaning that the scope to determine what kind of actions contribute to the extreme urgency cannot be limited to a notional test of their nature. After all, the ratio of the provision is to ensure incompetence is not used as an excuse to use the procedure.

Furthermore, I contend that the decision(s) are not only political but also technical/administrative due to the practical implications they have on operational matters.

One extra note on the approach taken by the UK Government regarding the emergency supply of ventilators is that in Spain, Seat is allegedly ready to produce 300 ventilators *a day* on a single factory whereas the Ventilator Challenge UK is going to supply 30 by this weekend. And from Dyson, all we have thus far is a nice render.

2. The Commission's JPA (and recent guidance...)

Albert considers that my main argument is the counterfactual offered by the Commission's JPA of ventilators. It is a fair assumption to make as it was indeed the JPA which provided me with the beginning of the thread I have been following since. It is not, however, as relevant in the grand scheme of things as the overall (in)action by the UK Government that led to the extreme urgency that was acted upon on March 16th.

As for the counterfactual itself, the Commission is likely to have also used a procedure without prior notice as that's what it did with the PPE equipment. This obviously reduces the value of my original argument since I assumed an accelerated procedure had been used, but the Commission is not exactly in the same position as a national government. First, the Union only has supporting competencies in healthcare, thus meaning the Commission cannot really get the ball rolling even if it wants. Then, in this particular instance it was only on March 10th or 13th that the Member States tasked the Commission to act upon the lack of ventilators within the context of the JPA. It is not as if the Commission contributed to this particular extreme urgency by not acting...

But the fact is the Commission is providing with air cover to the Member States by running the negotiated procedure(s) without prior notice *and* by the text of guidance published earlier this week. When I first read it, I found puzzling the Commission would go out of its way and consider that the whole crisis was unforeseeable. I found it odd and, frankly, lacking in restraint. But it now makes sense since it is running negotiated procedures without prior notice on behalf of the Member States and is effectively trying to protect their decision-making that led to the use of the JPA.

This is problematic as a Communication by the Commission is not a source of law and, thankfully, not seen either as gospel by the CJEU, but it does carry weight and may influence national courts as an interpretative mechanism. That worries me as it might mean it will be used to wrap around potential questionable decisions taken by Member States on the run up to the use of the JPA. If the decisions were not questionable then there would be no need for those paragraphs in the Communication....

My overall take on the predictability of the crisis is that it was not unpredictable that PPE and ventilators  in excess of current stocks would be needed since at least the end of January and early February. What was (and probably still is) unpredictable is the exact level of supplies needed to deal with the crisis. But procuring for uncertain demand is not exactly unheard of in public procurement and we have plenty of tools at our disposal to deal with it, namely framework agreements and dynamic purchasing systems. Again, these could have been set up quickly if action had been taken when needed, but weren't.

3. Consequences

Well, my take is that the Dyson contract is illegal and the decision to award it, reviewable. If it will or not, that's a different story of course as the optics of anyone bringing a case against it at the moment would look horrible.  I am not naive enough to expect otherwise.

As for the National Audit Office or the eventual inquiry that will have to be occur, let's wait and see. But anything coming out of either will take years and beyond any reasonable time frame to have any sort of impact. Just like the Garden Bridge.