In response to the outbreak of COVID-19, the UK Government published two procurement policy notes (PPNs). PPNs set out best practice guidance for public bodes ("contracting authorities"). They apply to a number of public contracts including contracts for goods, services and works.
PPN 01/20 provides guidance to contracting authorities on how to respond to the impact of COVID-19 and how to award contracts in times of extreme urgency.
PPN 02/20 provides guidance for ensuring service continuity during and after COVID-19. Contracting authorities are advised to review their contracts and payment provisions and put in place measures to support supplier cash flow. These include ensuring supplier invoices are paid immediately following receipt and suppliers agreeing to act on an open book basis and to make cost data available to the contracting authority.
Contracting authorities are also advised to work with suppliers to amend or vary contracts if a supplier applies for contractual relief. These will need to be considered on a case by case basis but the guidance indicates that changes may include changes to requirements, delivery locations, frequency and timing of delivery and performance indicators or may include contract extensions or waivers, for example the contracting authority may waive it's right to receive service credits or to terminate.
Both PPNs acknowledge the impact that COVID-19 is having on businesses and supply chains. The guidance will also be of interest to the private sector when considering how to assist suppliers who are struggling and most at risk.
This Procurement Policy Note (PPN) sets out information and guidance for public bodies on payment of their suppliers to ensure service continuity during and after the current coronavirus, COVID-19, outbreak.