Some thoughts on the UK gov net-zero public procurement guidance

No sooner would I get my head around how one should go about and implement mandatory green public procurement (well in the EU at least) and the UK government ends up publishing a a new public procurement policy note on carbon reduction. This new guidance will mandate economic operators bidding for contracts valued at £5M or higher to have Carbon Reduction Plans aiming to achieve net zero by 2050 from September 30th onwards.

This is being billed as a 'selection criterion' to be used as part of the assessment of a supplier's technical and professional ability and frankly, for the most part, it amounts to handwaving and virtue signalling. I can find five problems with it.

First, although this is called a 'selection criterion' the fact that it is connected with the whole of the economic operator and not only with the contract breaks the nexus between selection criteria and the contract. Therefore, if this is really going to be applied, then it amounts to a discretionary exclusion ground because it is not connected with the contract but with a condition of the economic operator itself. This is a poor sign for the upcoming change in legislation.

Second, the extent of the obligation is for the economic operators to have a Carbon Reduction Plan, not to stick to it. Therefore, as long as they have one that they keep up-to-date, this is all they are being asked to provide. In addition, the obvious strategy for economic operators is to follow the lead of the train operators who won concessions for rail services whereby they backloaded all the major costs in the final years of the franchise. Logic will dictate a similar approach here and there is nothing to be done by the contracting authorities.

Third, this only applies to the UK operations of the economic operator. Therefore, another obvious avenue for the economic operators to feign compliance is to attribute the most polluting elements of their business to business units based elsewhere and reduce the UK entity to a simple shell/service provider.

Fourth, in connection with three, even if this provision had any teeth, what this would lead to was a displacement of polluting economic activity to other parts of the world as to ensure compliance in the UK. Paradoxically, the net result might be an in increase in emissions even if there is a reduction in the UK itself.

Fifth, as published the guidance amounts to a generic tick box exercise. This is the polar opposite of what I suggested last week as a good(enough) approach to reduce greenhouse emissions. It is not narrow, targeted or frankly able to move the needle on climate change.

All in all, a missed opportunity. Well intentioned, perhaps, but still a misplaced effort.