Councillors call for law change to let councils reject Russian state-backed firms


York Lib Dem councillors are calling for change to council procurement laws which risk allowing state-backed Russian firms into the UK public sector unchallenged.

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Under current legislation in the Local Government Act, councils are banned from taking into account a range of non-commercial considerations when awarding contracts – specifically the location or origin of a bidder, and any political or sectarian affiliations.

Under these rules, councils must award the work to any bidder who can meet the expectations of the contract.

Councillors are joining calls first made by Merton Council on the Secretary of State for Levelling Up, Housing & Communities to use his powers under the act to make urgent changes to the law, ensuring councils are not obliged to re-award contracts to such companies in the future.

 

Councillor Nigel Ayre, Liberal Democrat Executive Member for Finance and Performance, commented:

 “The Council is currently going through all investments, contracts and procurement arrangements to ensure we are not trading with Russian companies, and will take immediate action to end contracts if necessary.

“We are determined to ensure our city has no links to companies which associate with Putin, indirectly financing the brutal invasion of Ukraine.

“The current rules do not let councils reject a contract based on concerns about moral or social issues, nor state affiliations; it’s specifically prohibited. This law must be urgently changed to empower councils across the county to ensure companies that are not aligned to the UK’s interests at times like this can’t abuse the procurement process.

“We must stand with Ukraine – not just with words but with actions. The Government’s response has been limited and slow in the face of the unimaginable horror currently being faced by Ukrainian people and it needs to be stepped up immediately.  I’m pleased that in York we are united in our calls and ambition to support Ukraine in any way we can.”


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