The regulatory framework for single source defence contracts came fully into effect in December 2014. It controls the prices of qualifying contracts and requires transparency on the part of defence contractors regarding their prices and capacity to continue to meet government requirements.
The Secretary of State is required to complete periodic reviews of the framework, with the first review to be completed by December 2017. The SSRO’s functions include keeping the operation of the framework under review and making such recommendations for change to the Secretary of State as it considers appropriate. In carrying out a review, the Secretary of State must have regard to any recommendations made by the SSRO, provided these are submitted six months before the date on which the review is to be completed. This means that the SSRO has to make recommendations in June 2017 in order to meet the statutory deadline.
On 30 January 2017 the SSRO published a consultation which proposed a number of recommendations for the first review of the regulatory framework for single source defence contracts. The SSRO has focused its proposed recommendations for change on three key areas: ensuring that single source spending is appropriately covered by the regime; enhancing transparency; and providing effective enforcement of the regime. As part of our consultation, the SSRO also held meetings and workshops with key stakeholders.
Before reaching our final conclusions and publishing our recommendations in June 2017, the SSRO has today sent to consultation respondents an update on its review of the regulatory framework, outlining the feedback we have received from stakeholders and the progress made since the consultation closed on 24 March 2017.