Coronavirus: public buyers should increase use of procurement cards

7 April 2020

Public sector buyers should increase use of procurement cards to improve efficiency and accelerate payment to suppliers.

In a Procurement Policy Note (PPN), the Cabinet Office (CO) said the outbreak of Covid-19 had placed “increased pressure” on commercial and finance teams and increased importance of maintaining cashflow to suppliers.

The cards allow goods and services to be purchased without using traditional purchasing processes such as purchase orders and invoices. 

The PPN said: “Increasing use of procurement cards can improve organisations’ efficiency and accelerate payment to their suppliers while still ensuring robust controls.”

Organisations should urgently engage with procurement card providers to increase the single transaction limit to £20,000 and raise monthly limits to £100,000 for key cardholders, the PPN said. 

It added that not all card users would require a £20,000 limit, so authorities should “ensure appropriate limits are set”. 

By 30 April the CO said organisations should ensure the appropriate number of staff have authority to use procurement cards and relevant categories should be opened to encourage wider use. 

The PPN added: “Procurement cards should be the preferred method for purchasing all goods and services, up to the card limit, unless existing departmental systems are faster.

“This does not alleviate accounting officers of their usual duties to ensure that spending delivers value for money and proportionate controls to payments are undertaken as necessary for continuity of supply of critical services.”

Last month, the CO highlighted the importance of maintaining payments to suppliers. In a PPN, it said public buyers should continue to pay suppliers as normal so firms are able to fulfil their contractual obligations when the outbreak is over.

A separate PPN also said contracting authorities may “enter into contracts without competing or advertising the requirement” for urgent goods and services necessary needed to respond to coronavirus.

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