On February 17, Her Majesty's government issued a "Public Procurement Note". As there has been a great deal of media misreporting (perhaps deliberate) of what this document means, I propose to explain the precise significance of the document and to set it in a wider context.
Few PPNs could have seen the light of day in such a blaze of publicity. Normally, these rather tedious technical documents would not merit even a brief paragraph in the business sections of the broadsheets. But the birth of "Information Note 01/16: Ensuring compliance with wider international obligations when letting public contracts" (to give it its full title) was announced, not in the Palace of Westminster, or at some Whitehall briefing, but by Cabinet Office minister Matt Hancock during an official visit to Israel.
Referring to the safety and well-being of the UK, Hancock explained that the current situation, whereby local authorities were free to make what they regarded as principled (''ethical'') purchasing decisions, was "undermining" national security.
So "localism" is officially dead. "The new guidance on procurement," Cabinet Office minister Hancock explained to the Israeli public, "combined with changes we are making to how pension pots can be invested, will help prevent damaging and counter-productive local foreign policies undermining our national security."
Not that the 2011 Localism Act has been repealed. It hasn't. But the principle enshrined in that Act (its opening sentence laughingly proclaims that "A local council has power to do anything that individuals generally may do") must clearly be consigned to the dustbin of history.
This is a legal obligation not to allow councils to discriminate
The background to PPN 01/16 is to be found in the antics of sundry local authorities such as Leicester City Council, which, in 2014, resolved to boycott goods produced in Jewish settlements in Judea and Samaria. A number of Israeli companies, and some international conglomerates which have investments in these provinces, have also been targeted by the BDS movement.
The government of Scotland has gone so far as to publish a procurement notice to Scottish councils strongly discouraging trade with and investment in what are termed "illegal" settlements. "We need," Cabinet minister Hancock explained to the Israeli public, "to challenge and prevent these divisive town-hall boycotts." And that is precisely what PPN 01/16 is supposed to do. Henceforth, no contracting public authority, local council, quangos or even a university that receives most of its funding from the taxpayer, will be able to take a so-called ''ethical'' decision as to whom it purchases good and services from, unless authorised so to do by the Westminster government. No sooner had PPN 01/16 been born - no sooner had a beaming Bibi Netanyahu shaken hands in Jerusalem with a beaming Matt Hancock who had just announced its birth - than its critics launched against it a series of verbal assaults. Speaking on behalf of party leader Jeremy Corbyn, a Labour spokesperson accused Hancock of restricting local democracy and freedom of expression.
Hugh Lanning, chair of the Palestine Solidarity Campaign, condemned PPN 01/16 as "a gross attack on our democratic freedoms and the independence of public bodies from Government interference".
All that the PPN does is to restate the law, namely that, under existing international agreements, there is a legal obligation on public authorities, when awarding contracts above certain thresholds, not to discriminate against suppliers based in any country of the EU or which is a signatory to the WTO Government Procurement Agreement (which signatories include Israel).
PPN 01/16 reminds local authorities that, should they ignore this legal obligation, they would render themselves liable to fines and actions for damages (which would be paid by council taxpayers). As for freedom of expression, local authorities are as free now as they were prior to February 17 to pass whatever declaratory resolutions they please.
In the selfsame statement in which the government announced the birth of PPN 01/16 it affirmed the UK's continuing commitment to guidelines recently approved by the EU requiring member states to ensure that products made in Jewish settlements on the West Bank or the Golan or in East Jerusalem are labelled as such!
