Public procurement notice: Voluntary Ex Ante Transparency Notice
Published: 2017-02-22
Buyer: Oxfordashire County Council
Country: UK
Region: Oxfordshire
Contract type: Works
Procedure: Contract award without prior publication
CPV classification: 45210000: Building construction work | 71220000
Estimated value: 13020000 
Award criteria: Lowest price

Technical requirements: Agreement relating to the development of land at Grove Airfield, Denchworth Road, Grove, Oxfordshire —Section 106 of the Town and Country Planning Act 1990.
The proposed Contract will be a planning obligation pursuant to Section 106 of the Town and Country Planning Act 1990 relating to the proposed development at former Grove Airfield, Grove (‘the Development’). It will contain a series of commitments by the developer, conditional on implementation of the Development (entirely at the discretion of the developer) and progress of the Development for delivery of mitigating measures including the design and construction of 2 primary schools. The developer also has the choice of providing land to Oxfordshire County Council plus funding so that the County Council may design and construct 1 or both of the primary schools instead.
Procedure used: Award of a Contract without prior publication of a Contract Notice in the Official Journal of the European Union (in the cases listed in Section 2 of Annexes D1, D2 or D3 as appropriate).
In the proposed agreement (‘the Section 106 Agreement’) the Developer is afforded the choice of providing:
a. land for 2 primary schools and funding for their construction which does not amount to a public works contract because there is no contract with the Developer for works to be undertaken,
b. land for 1 of the primary schools and funding for its construction (see a above) with the Developer undertaking the construction of the other primary school and then passing the school as built to the County Council,
c. The Developer undertaking the construction of both of the new primary schools and then passing the new primary schools as built to the County Council.
The agreement where option b or c is adopted for 1 or both of the new primary schools to be built by the Developer does not constitute a public works contract on 2 grounds.
1. The essential ingredient of a public works Contract is that it is for pecuniary interest — see Regulation 2of the Public Contract Regulations 2015 (‘the Regulations’). The Advocate General's opinion on European Commissionaire (Kingdom of Spain) (2011) CR GO attempts to provide a definitive statement of the meaning of ‘pecuniary interest’ concluding that it implies that the Contracting Authority needs to use its own funds either directly or indirectly. Direct financing will occur when the Contracting Authority uses public funds to pay for the works or services in question. Indirect financing will occur when the Contracting Authority suffers economic detriment as a result of the method of financing the works or services. In this case there is no direct financing and as the grant of planning permission does not amount to pecuniary interest (see Hulmut Muller GMbHv Bundesanstalt Fur Immobilienaufgaben), there is no consideration given in return for the requirement to construct a school.
2. It is also a requirement of a public works contract that there must be a legally enforceable obligation to carryout works or work. The High Court determined in R (Midlands Co-operative Society Limited) v Birmingham City Council (1) Tesco Stores Limited (2) that where the building obligations in an agreement pursuant to Section106 Town and Country Planning Act 1980 (‘S106 Agreement’) were conditional upon the developer commencing the development which he was not legally obliged to do, there was no public works contract. The Section 106agreement in this case is a S106 Agreement and the building obligations will indeed be conditional upon the developer commencing and then progressing the development which it will not be legally obliged to do.
1. The estimated value of the school works is 8 000 000 GBP for the 1st primary school and 5 020 000 GBP for the 2nd primary school,
2. In the S106 Agreement, the Developer will agree to undertake a transparent and impartial procurement process for the school works.
Agreement Relating to the Development of Land at Grove Airfield, Denchworth Road, Grove, Oxfordshire —Section 106 of the Town and Country Planning Act 1990