Procurement in a Nutshell – the change from MEAT to MAT

In December 2021 the Government published its response to the consultation and the comments raised by over 600 organisations and individuals. As a result we now have a clearer indication of the reforms that the Government intends to introduce.

The Government plans to produce a draft Bill at some point in 2022. Further to the new legislation the Government will also introduce new secondary legislation or regulations to implement the new regime and produce “a detailed and comprehensive package of published resources (statutory and non-statutory guidance on the key elements of the regulatory framework, templates, model procedures and case studies)” to help contracting authorities and suppliers understand how the new regime will work.

Due to significant changes and the amount of work required to bring this all into effect it is unlikely that the new regime will be implemented until 2023 at the earliest. We can expect a draft Bill this year and the Government has said that it intends to give at least 6 months’ notice of “go-live”.

What this Nutshell covers

This Nutshell looks at the proposal to change from the requirement to evaluate bids according to the most economically advantageous tender (MEAT) to the most advantageous tender (MAT).

What the Green Paper said

In the Green Paper the government considered that the current PCR rules for bids to be evaluated according to the MEAT had a number of drawbacks, which between them counter-productively meant that contracting authorities did not always feel able to accept the tender which would overall be the most suitable. Identified issues included that the tender must always be considered from the contracting authority’s point of view, which could restrict social and environmental considerations, and that the emphasis on cost effectiveness could be interpreted to mean that the lowest bid was generally preferred. The rules were often seen to require an assessment of cost-effectiveness first, with quality considerations coming second.

The proposed MAT would allow contracting authorities to take a wider approach to what can be considered when assessing tenders, which is seen as having particular benefits to social value considerations. The Green Paper was keen to stress that in fact the current regulations provide for these considerations, so the change would be a change of emphasis, and additional clarity on the wider criteria.

Results of the Consultation

Responses to this proposal were very positive and clearly in favour. The proposal was seen as a positive step in encouraging new approaches to procurement. However, concerns were raised about a loss of emphasis on value for money, and that it would disadvantage SMEs who may not be able to invest in a way that the MAT provisions would be looking for. Consequently, respondents asked for further clarity and examples that would help in the assessment of tenders.

The government therefore proposes to introduce the change from MEAT to MAT as outlined in the Green Paper. To address concerns about the impact on SMEs the government will introduce provisions on proportionality into the regulations, whereby the cost and scale of the tender provisions must match the size of the project.

What this means

The removal of the word ‘economically’ is expected to broaden the criteria that contracting authorities can use when assessing tenders, and to re-calibrate the balance between cost effectiveness and other criteria. Contracting authorities should expect to see improved ability to innovate and to secure better outcomes both for themselves and in the wider impact, whilst being re-assured that they can confidently do so within the rules.

If you have any queries on the issues raised or on any aspect of procurement, please contact one of our procurement specialists via our procurement hotline on 0330 137 3451