Defence and Security Public Contracts (Amendment) (EU Exit) Regulations 2020 — House of Lords, 2020-11-03
Topic: Defense
Annabel Goldie (Conservative, Centre-right): My Lords, as we look towards 2021, planning for the smooth delivery of defence and security procurement beyond the transition period is absolutely essential. This instrument will ensure that defence suppliers and buyers have the legal certainty they need beyond 31 December. It is a small instrument, but a necessary one In the interests of accuracy, I draw attention to a minor error in the heading to Regulation 2 of the instrument, which currently reads "Pre-exit amendments of the Defence and Security Public Contracts Regulations 2011". Regulation headings are not an operative part of the instrument and Regulation 1(2) explicitly states that Regulation 2 comes into force the day after the day on which these regulations are made. It has been confirmed by the laying offices and the legal counsel to the JCSI that the deletion of "Pre-exit" can and shall be made editorially, prior to signature. In the interests of transparency, it is appropriate to bring that to the attention of your Lordships Before we consider the detail of this statutory instrument—which I shall refer to as the 2020 regulations—I highlight that this is the second EU exit amendment to the Defence and Security Public Contracts Regulations 2011. The first amendment was debated in both Houses and signed by the Secretary of State for Defence last year. The 2019 regulations, as amended by the 2020 regulations, will now enter into force on implementation period completion day, which is the end of the transition period This instrument ensures that the procurement provisions of the withdrawal agreement and the European Economic Area European Free Trade Association separation agreement are correctly applied to the procurement of those public contracts and framework agreements which have been launched but not finalised under the Defence and Security Public Contracts Regulations before the end of the transition period. These transitional procurements will be regulated under that version of the Defence and Security Public Contracts Regulations which meets our current European obligations. Businesses, and indeed the MoD and our much-valued security agencies, will continue to have legal certainty beyond transition period completion day. Defence and security procurements will therefore be underpinned by solid legal bedrock Reflecting that, Regulations 3 and 4 of the 2019 regulations will now come into effect at the end of the transition period. The 2020 regulations replace references to "exit day" in the 2019 regulations with "implementation period completion day" where necessary. The opportunity has also been taken to update certain references to financial thresholds in the 2019 regulations, which were revised during the transition period. These are small corrections, but they are necessary As well as amending the 2019 regulations, the new legislation updates and corrects the original 2011 regulations. Noble Lords will note that these changes are not related to EU exit. In Regulation 12, which covers technical specifications, an outdated reference to "European technical approval" is replaced with "European technical assessment" I reassure your Lordships that, when drafting this instrument, care has been taken to ensure that it is as consistent as possible with other government public procurement legislation. This change to Regulation 12 brings defence and security procurement legislation into alignment with the Public Contracts Regulations 2015. It is a straightforward amendment, as the system of European technical approvals is no longer in practice and has been replaced by European technical assessments. The opportunity has also been taken to update the reference to the common military list of 2018 with the common military list of 2020 Together, the 2019 regulations and this instrument reflect the UK’s new status outside the EU. The 2019 regulations, agreed by this House over 18 months ago, restrict automatic legal access to the UK’s defence procurements to suppliers from the UK and Gibraltar only. However, the framework and principles underlying the procurement regime remain unchanged. As your Lordships are aware, this is in accordance with the powers given to amend retained EU law in the European Union (Withdrawal Act) 2018. That Act does not allow major policy changes or the introduction of new legal frameworks. Amendments to the Defence and Security Public Contracts Regulations made under the powers given by the 2018 Act are limited to dealing with the effect and consequences of EU exit More broadly, freedom to consider the reform of our defence and security procurement regulations is one of the consequences of our exit from the EU. So, as we look beyond the transition period, this freedom is being used positively to develop defence and security procurement regulations tailored to better meet the UK’s needs. A comprehensive review of the Defence and Security Public Contracts Regulations is under way with a view to improving the pace and agility of acquisition. This is a significant piece of work which will take some time to complete and will require the introduction of new primary and secondary legislation. In the meantime, the amendments that these regulations make will ensure that public procurement business conducted under the umbrella of the defence and security procurement legislation will continue to flow smoothly and confidently I look forward to contributions from your Lordships, not least that from the noble Lord, Lord Dodds, who is making his maiden speech this afternoon. I commend the 2020 regulations to the House and beg to move.