Source · Select Committees · Public Accounts Committee
Recommendation 26
26
Rejected
Public procurement regulations limit consideration of supplier's past performance in tendering.
Conclusion
We asked the Cabinet Office if it considers the past performance of companies when procuring suppliers. It said that it did take past performance into account.58 Subsequently the Cabinet Office has written to the Committee to clarify that public procurement regulations state that consideration of a supplier’s past performance when tendering a contract 52 Q 75 53 Letter from Cabinet Office, 5 August 2025 54 C&AG’s Report, para 1 55 BBC News, Teachers in divorce ‘limbo’ take pension legal action, 24 March 2025 56 Q 79 57 Letter from Cabinet Office, 5 August 2025 58 Q 101 14 is at the contractor’s discretion, and that a supplier may be excluded from a tender on grounds of past performance only where past failures were significant such that a contract was terminated early.59
Government Response Summary
The government disagrees, stating that it follows the Procurement Act of 2023 which outlines the requirements for ensuring equal treatment and transparency across the procurement process, including reviewing whether an in-house solution is a viable option.
Government Response
Rejected
HM Government
Rejected
6. PAC conclusion: There has been a small market of pension administrators bidding for the contract, potentially limiting the Cabinet Office’s ability to secure value for money for the scheme administration. 6. PAC recommendation: The Cabinet Office should set out in its Treasury Minute response its overall commercial strategy for pension administration including consideration of the benefits and costs of administering the scheme in-house. 6.1 The government disagrees with the Committee’s recommendation 6.2 The Procurement Act of 2023 outlines the requirements for ensuring equal treatment and transparency across the procurement process. The Cabinet Office is legally required to follow the guidelines as set down by the Act. 6.3 The Cabinet Office follows the standard procurement procedure when deciding on the needs of the contract this includes. • Identifying the need • Performing market analysis • Developing a sourcing strategy 6.4 During early stages of any procurement several options are reviewed, these include reviewing whether an in-house solution is a viable option as well as the outsourcing options before any decision on procurement direction is made. 6.5 All options are then assessed against a series of critical success criteria to determine the most appropriate solution for the service. 6.6 The Cabinet Office will continue to comply with the Procurement Act 2023 and any future iterations for all future procurement exercises relating to Pensions.