The government is committed to giving local businesses a fair chance when awarding contracts, says Treasury Minister Alfred Cannan

Tynwald has now approved a new Treasury policy on procurement.

It was drawn up, Mr Cannan said, to ’reflect the actions outlined in the Programme for Government to improve our procurement policy to ensure that we spend more money locally where possible’.

He added: ’Prior to this new policy in 2015-2016, 58 per cent of our supplier spend was made locally and, averaged out over the previous three years, 95 per cent of tendered contracts were awarded to local firms and businesses where a local supplier submitted a bid.

’However, we want to build on that and ensure that local businesses are given a fair and equal opportunity when it comes to bidding for contracts.’

The government spends more than £200 million a year on services and the policy has a stated aim to get best value for public money.

Measurement of that value will also include social impact and benefit to the Manx economy.

The policy sets out three main aims:

Best value from government purchasing, while ensuring government’s purchasing power is used to spend locally wherever possible.

Purchase through fair and open competition.

Make selling to government as simple and straightforward as possible.

Mr Cannan said that, prior to 2011, the government had a weighting allowance of up to an extra 5% for local firms, but that was dropped on legal advice because of international obligations.

’The legal advice in this regard remains unchanged,’ he added.

’That said, Treasury will continue to closely monitor any changes with regard to our treaty obligations as the Brexit process continues.

’Quite frankly, Mr President, in addition to the legal position I do not believe that a local price weighting is necessary or in the public interest.’

The policy was welcomed by Tim Baker (Ayre and Michael, pictured), whose original call for fairness in the food and agriculture sectors had led to the wider policy.

’It looks very well thought-through to me and I think it will make a huge difference,’ Mr Baker said.

’In particular, it explicitly recognises the local economic multiplier effect and also social value - both concepts which I believe have been understated in previous approaches.’

There are exemptions to the stipulation for open bidding for government projects.

These include for work ’of exceptional urgency caused by unforeseeable circumstances where competitive tendering would cause unacceptable delay’ or when the chosen supplier has ’by recent experience’ proven to offer best value for money.

Another exception is if there is only one known supplier of the goods or services. Intellectual property rights could also provide an exemption.

The obligation to advertise all contract opportunities applies to schemes with a value of £10,000 or more.

Julie Edge (LibVannin, Onchan) queried why that threshold could not be lower.

Meanwhile, Juan Turner MLC said it was important that the policy remained under constant review, to ensure that it was kept as simple as possible for firms applying for contracts, particularly small businesses.