Government says procurement changes align Gibraltar with UK law 

The Government of Gibraltar said changes to procurement regulations brought Gibraltar into line with UK law and were not designed around any particular contract or company. 

Responding to GSD criticism of amendments to the Procurement (Concession Contracts) Regulations, the Government said the provisions would allow direct awards in defined circumstances, principally where an open procurement process had failed to produce a successful tenderer. 

The GSD had questioned the need for the amendment, recalling “deep criticism” by the former Principal Auditor about the Government’s adherence to tendering and procurement rules.  

The party highlighted the auditor’s concerns that a lack of tendering could create a “perception of favouritism or corruption” or cause “damage to market confidence”. 

But, on Wednesday, the Government rejected the Opposition’s criticism and said safeguards on transparency, equal treatment and scrutiny remained in place. 

The Government said the UK’s Procurement Act 2023 allowed contracting authorities to switch to a direct award where a competitive tender process had failed to produce a suitable tenderer. 

It said Gibraltar’s rules now did the same and argued that, in those circumstances, the alternative could be a lost public service or lost revenue for the public purse. 

“What we are doing is simple,” the Chief Minister, Fabian Picardo, said. 

“We are making sure that Gibraltar's law matches UK law.” 

“These provisions apply only in defined circumstances, where an open process has already been run and has not been able to produce a successful tenderer.” 

“Every safeguard of equal treatment, transparency and judicial review remains in place.” 

The Government said direct awards in limited circumstances had formed part of UK, EU and Gibraltar procurement law since 2016, adding that the grounds now adopted followed the World Trade Organisation Government Procurement Agreement, on which the UK regime was built. 

Under the amended rules, every direct award must be supported by a written report setting out the grounds and facts relied on. Those reports would be laid in Parliament, while a concession award notice must be published within 48 days of an award. 

Concession granters must continue to treat operators equally, without discrimination and transparently, and no procedure could be designed to favour an operator. 

The Government said duties to prevent, identify and remedy conflicts of interest remained unchanged.  

It added that these would be strengthened by a new Conflicts of Interests Act drafted by Daniel Greenberg, the UK Commissioner for Standards, which it accused the GSD of refusing to support. 

The Government said the Principal Auditor’s access to decisions and supporting documents remained unrestricted, while operators who believed they had been treated unfairly could challenge an award in the Supreme Court, which could declare a contract ineffective. 

It also said that, under a concession, the operator took the commercial risk and paid the Government for the right to operate, rather than receiving payment from the taxpayer. 

In criticising the latest amendment to the procurement regulations, the GSD had called the Government to identify who would benefit from the change. 

In reply, No.6 Convent Place said the only Government to have granted a big contract without tender was the GSD while in office. 

It said the former GSD administration had awarded the airport road and approach lighting works contract in breach of Gibraltar and EU law in 2010, adding that the GSLP terminated that contract in 2012. 

“The GSD are seeing bad faith where there is none,” Mr Picardo said. 

“Perhaps that is because, when they were last in Government, they acted contrary to the law themselves.” 

“The only big contract granted in breach of procurement rules was granted by the GSD in 2010/11, for the airport simple approach lighting and the associated road works.” 

“That is the record Mr Azopardi's party should be explaining before it lectures anyone on tendering.” 

Mr Picardo said the Government welcomed scrutiny from the public, the press, the Principal Auditor and the courts. 

“What we will not accept is the insinuation, without a shred of evidence, that a sensible alignment with UK law is a cover for something improper.”  

“It is not, and the GSD should have the decency to say so and accept that they are the ones who broke the law in this area, not us.” 

“Mr Azopardi's party has nothing to be proud of in this regard. It will be my pleasure to remind them of that as often as I have to.”