Discretionary Lot Allocation Under the Light-Touch Regime: Permissible Limits and Equal Treatment in Multi-Lot Public Contracts

Discretionary Lot Allocation Under the Light-Touch Regime: Permissible Limits and Equal Treatment in Multi-Lot Public Contracts

1. Introduction

This commentary examines the judgment of the Scottish Court of Session in Turning Point Scotland v Glasgow City Council ([2025] CSOH 42), delivered by Lord Sandison on 2 May 2025. In a procurement challenge under the “light-touch” regime of the Public Contracts (Scotland) Regulations 2015, the pursuer, Turning Point Scotland, contested the council’s decision to award Lot 4 (tied with Lot 5) to The Salvation Army Trustee Company despite Turning Point having submitted the highest‐scoring tender for that lot. The core issues were: (a) the nature and scope of the contracting authority’s discretion to limit the number of lots awarded to one provider; (b) the duty of equal treatment and transparency; and (c) the application of the best price‐quality ratio criterion under Section 7 (social services) of the Regulations.

2. Summary of the Judgment

The Court of Session upheld the council’s decision. It held that:

  • The “light-touch” regime (Schedule 3, Section 7 of the 2015 Regulations) permitted a contracting authority to structure a multi-lot procurement so that no single tenderer could win more than a stated maximum number of lots.
  • Where tender documents (Contract Notice and Invitation to Tender) clearly set a maximum number of lots per bidder and reserved a discretion to amalgamate lots or award multiple lots only to avoid unfilled lots, the authority’s exercise of that discretion in accordance with the published procedure does not breach equal treatment—even if the highest-scoring tenderer for a given lot loses out.
  • The governing award criterion remained the best price-quality ratio, but that criterion coexisted with the authority’s structural objective of widening market participation and capacity.
  • Turning Point’s complaint was not that the documentation lacked transparency, but that the authority misapplied it. The court found no misapplication: the council lawfully awarded Lot 3/5 to Turning Point (its first preference) and, because of the one-lot-only rule within Lots 1–4, awarded Lot 4/5 to the next highest bidder.

3. Detailed Analysis

3.1 Applicable Regulatory Framework

The Public Contracts (Scotland) Regulations 2015 establish:

  • General procurement principles (Regulations 19 – transparency, equal treatment, proportionality).
  • Division into lots (Regulation 47): allows limiting the number of lots per tenderer, provided the limit is stated, and setting objective rules for allocating lots when multiple lots are won by a single tenderer.
  • Social and other specific services (“light-touch” regime, Regulation 74–76): mandates award on best price-quality ratio but permits tailored procedures reflecting service specificities and user needs.

3.2 Precedents Cited

The principal authorities cited included:

  • SIAC Construction Ltd v County Council of Mayo (C-19/00) – using the “reasonably well-informed and normally diligent” (RWIND) tenderer to assess transparency in EU procurement documents.
  • Healthcare at Home Ltd v CSA [2014] UKSC 49 – defining the RWIND standard and the overarching duty of equal treatment.
  • Working on Wellbeing Ltd v DWP [2024] EWHC 766 (TCC) – clarifying that contracting authorities’ procedural discretions must conform with equal treatment and transparency and are subject to judicial review.
  • Capita Business Services Ltd v CSA [2023] CSOH 9 – emphasising that discretion in tender documents must not be exercised arbitrarily or capriciously.

These decisions guided the court’s analysis of how discretion in lot allocation interacts with fundamental procurement principles.

3.3 Legal Reasoning

Lord Sandison’s reasoning proceeded in three stages:

  1. Primacy of the Contract Notice and Section 7: Regulation 76(4) gives priority to the procedure described in the Contract Notice for “light-touch” services. The Contract Notice here specified:
    • Tenders could be submitted for all 6 lots.
    • Maximum 3 lots per tenderer.
    • Only one supplier per Lots 1–4; residual discretion to amalgamate or award multiple lots solely to avoid unfilled lots.
  2. No Procedural Breach: Turning Point alleged the council mis-operated the procedure by awarding Lot 4/5 to the second‐scorer. The court found:
    • The council adhered to the published one-lot-only rule for Lots 1–4.
    • It explained its decision transparently.
    • No unfilled lot emerged; therefore, no basis to exercise the amalgamation or multi-award discretion.
    Hence, there was no departure from the published procedure or from the principles of transparency and equal treatment.
  3. Equal Treatment and Best Price‐Quality Ratio: Regulation 76(10) requires an award on the best price-quality ratio, but within the permitted structural constraints of the procedure. The council’s market‐access objective (widening provider base, ensuring capacity) lay within the scope of permissible considerations. Limiting Turning Point to one of the tied Lots 3/5 or 4/5 did not breach equal treatment: another bidder in comparable circumstances would have been treated identically.

3.4 Impact and Future Significance

This decision clarifies that under the light-touch regime:

  • A contracting authority may lawfully limit the number of lots per provider and enforce that limit, even if it causes a high-scoring tenderer to lose a lot.
  • Provided the procedural rules are published, objective and applied consistently, there is no breach of equal treatment or transparency when structural procurement aims override pure score-based allocation.
  • Challenges to the terms of lot-allocation rules must be raised promptly; challenges to application of those rules will succeed only if the authority has exceeded or mis-applied its published discretion.

Procurement officers and bidders in social-service frameworks must therefore pay close attention to lot limits and tie-in rules in Contract Notices and ITTs, and ensure any ambiguity is clarified before bidding to avoid time-bar issues.

4. Complex Concepts Simplified

  • Light-Touch Regime (Schedule 3): A streamlined set of rules for certain social and health services above threshold, giving contracting authorities flexibility to tailor procedures to service needs.
  • Lots: Sub-divisions of a contract enabling multiple suppliers. Authorities may restrict how many lots one bidder can win to encourage wider participation.
  • Best Price-Quality Ratio vs. Most Economically Advantageous Tender: Under Section 7, award must consider price and quality jointly, but also may consider broader service-specific factors (e.g., user needs, market capacity).
  • RWIND Tenderer: A hypothetical reasonable bidder used to test whether procurement documents are clear and whether the authority acted transparently.

5. Conclusion

The Turning Point Scotland v Glasgow City Council judgment establishes that, in a multi-lot public contract under the light-touch regime, a contracting authority may validly:

  1. Set and enforce a maximum-lots-per-bidder rule;
  2. Reserve discretion to amalgamate or multi-award only to prevent unfilled lots;
  3. Apply those structural rules consistently alongside the best price-quality ratio principle without breaching equal treatment.

Bidders must scrutinize and challenge any ambiguous lot-allocation provisions promptly. Authorities must ensure that published lot limits and discretionary rules are clear, objective, and applied in accordance with the twin pillars of transparency and equal treatment.

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