Many suppliers to public bodies will struggle to meet their contractual obligations and this will put their financial viability, ability to retain staff and their supply chains at risk.
Public procurement delivers approximately £2.7 billion annually and is an important element of the economy. It is vital that steps are taken to protect suppliers and contractors during these challenging times.
What is the NI Executive doing to help?
The Executive has agreed to implement measures to ensure that Departments pay their suppliers as quickly as possible to maintain cash flow and protect jobs. Departments will also take action to continue to pay suppliers at risk due to Covid-19 on a continuity and retention basis so they are able to resume normal service delivery and fulfil their contractual obligations when the outbreak is over.
Suppliers to Government can request relief using various options such as interim payments, advance payments for goods or services, changes to delivery and payment dates and bringing forward orders and payments.
What departments will do
Departments will be required to use reasonable endeavours to provide relief through existing contractual mechanisms such as relaxing key performance indicators and service credits, and delays to delivery dates.
Supplier requests for relief must receive a response within three days of receipt. If approved the supplier must provide a certificate of costs which sets out the supplier’s actual costs, expenses, cash flow and profits. The supplier will also be required to ensure that staff and the contract supply chain are paid promptly.
What suppliers need to do
Suppliers must provide any information or evidence which may be reasonably required to verify the supplier has applied any monies as agreed with the department.
Further detail of the measures are outlined in the latest Procurement Guidance Note (PGN): Procurement Guidance Note 01/20: Supplier Relief due to COVID-19
Supplier’s seeking relief as a result of the impact of Covid-19 must contact the relevant Government contract manager. Each contract will have a contract manager and a mechanism to alert the government client of any issues.