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5 October 2011 | Angeline Albert

EU public procurement rules will shortly no longer apply to most UK universities, David Willetts yesterday told Conservative Party conference.

The minister for universities and science said the reduction in universities’ income for teaching from the state would free its purchasers from the constraints of EU procurement rules.           

Universities get 60 per cent of their income from the state, in future they will get 40 per cent of it in this way. If a state body receives less than 50 per cent funding from the state they are exempt from EU procurement rules.

Willetts told delegates: “As soon as you get less than half of your income from the state you are freed from obligations on the public sector set by the European Commission (EC). So I can announce today that we believe EU public procurement rules will no longer apply to the vast majority of our universities. Universities will be able to contribute more to their local economy by negotiating direct with local business.”

Andy Davies, London Universities Purchasing Consortium (LUPC) director said: “I would be very encouraged if the government’s position turned out to be deliverable. This is the belief of government but it requires confirmation from the EC. The cap on fees for home students [charged by universities] will go up in September 2012. But is student loan funding state funding?”

Davies said this would affect what percentage of universities’ income comes from the state. If the government’s belief turned out to be correct, he said higher education sector purchasers would benefit from shorter procurement timescales and a greater ability to negotiate with the market. He said university buyers would need better negotiation skills to take advantage of this freedom.