Further consultation over proposed e-invoicing regulations

The government is to undertake further consultation on proposed new laws aimed at requiring public sector bodies to accept electronic invoices, after a consultation raised fears over costs.

Crown Commercial Service officials have excluded an e-invoicing standard from a set of illustrative regulations published yesterday, which covers reforms to public procurement proposed by an emerging European Union directive,

It said that although it is committed to increasing the take-up of e-invoicing to improve efficiency, it wanted to make sure that any new regulations do not have the opposite effect.

In its response to an initial consultation on the reforms, which closed in November, the government said: “The imposition of an e-invoicing standard in the public sector that has not been agreed as acceptable, could impose costs and burdens on public bodies, suppliers and service providers.

“For example, care would need to be taken to ensure that any UK rules do not undermine the steps that organisations have already taken towards e-invoicing, or require significant system changes both when the regulations come in and once the European standard has been adopted.”

In April, the European Parliament and council agreed a directive on e-invoicing in public procurement, and plans to adopt it by May 2017.

The consultation with public sector bodies and suppliers, the results of which were also published yesterday, found potential barriers to e-invoicing, including a lack of understanding about the costs of procuring e-invoicing software and technology, the technological capability of suppliers and the public sector, integration costs and internal resources.

However, some respondents suggested that these barriers could be overcome by using free-to-use software and web-based systems that allow quick upload from both desktop and mobile devices.

Some responses also suggested that public sector organisations could also help remove barriers by offering self-service options on their own financial systems or electronic marketplaces.

The consultation summary document said: “Responses suggested that an agreed national or European standard needs to be established so that there is only one format for e-invoicing, and there needs to be an understanding of the technology basis of both the public sector and suppliers.

“The promotion of e-catalogues and ‘purchase to pay’ systems were seen as being important, as was the ability to control fraudulent invoices and having a smooth electronic data feed.”

A number of responses said that organisations at the leading edge of e-invoicing have web-based supplier portals on their company website accompanied by clear communication, guidance and training manuals.

The illustrative regulations did contain draft measures which would require the public sector to demonstrate pre-procurement market engagement encourages small and medium enterprises to bid for public contracts.

Another draft measure would require public bodies to have “due regard” to lean sourcing principles when carrying out procurement.

The government said it was also considering including the following areas in the emerging procurement regulations:

  • Making appropriate use of electronic invoicing
  • Making procurement advertisements, related documents and / or bidding processes accessible to potential bidders without charge (for example, electronically)
  • Including the appropriate considerations of SMEs within procurement strategies
  • Applying minimum and/or maximum timescales for carrying out procurements below the specified financial thresholds
  • Debriefing unsuccessful bidders for contracts
  • Making appropriate use of standard terms and conditions 

Colin Marrs

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