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PGN 02/20: Recovery and Transition from COVID-19

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By way of PGN 01/20, the Executive implemented, with effect from 25th March 2020, measures to endeavour to cushion the blow of the outbreak of COVID-19 on suppliers to the public sector. Within that PGN, the end of the Supplier Relief Period was set as 30 June 2020.

On 22 June 2020, PGN 02/20 was issued with the title Recovery and Transition from COVID-19 setting out guidance on how public sector should move forward in terms of the support mechanisms for public sector suppliers to “carefully wind down economic support schemes while people are eased back into work”.

PGN 02/20 advised that PGN 01/20 mechanism may still remain appropriate but that the “contracting authority has the final decision on whether it deems a supplier at risk and the form of any relief”.

The PGN requires all public bodies to, amongst other things, “review their contract portfolio, including where they are providing any contractual relief due to COVID-19 and, if appropriate to maintain delivery of critical services, continue or commence measures in line with PGN 01/20.” Work should thereafter be undertaken in partnership to exit any relief as soon as possible and to ensure that contracts are commercially sustainable and deliver value for money in the medium to long term. It also requires payment to suppliers to continue as quickly as possible.

The PGN acknowledges that there are a range of support measures including payment, revised milestones, interim payments, relief from KPI’s and Service Credits, forward ordering, payment on order or payment in advance. Any relief related to payment has to take into consideration any associated risks.

Transparency and open book accounting remains a feature of the transitional and recovery phase of the supplier regime.

Transitional planning includes the development of a plan to end the relief as soon as possible and in any event before the end of October 2020. The plan is to address an end date, deliver of forward ordered goods, reconciliation of payments, an assessment of any costs implementing health and safety advice and whether or not the contract is still operationally and commercially viable.

Accelerated discharge of invoices is still encouraged and additional measurements to ensure that there are no unnecessary delays.

This article has been produced for general information purposes and further advice should be sought from a professional advisor. Please contact our Procurement team at Cleaver Fulton Rankin for further advice or information.


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Lisa Boyd

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