PLC Public Sector reports:
A new standard pre-qualification questionnaire that must be used by all central government departments by December 2010 (with a promise of roll-out to the whole of the public sector), a review solving all of the causes of delay in the procurement process (also to report in December 2010) and a new contract finder system to be launched in March 2011. All this in addition to creating a new type of framework agreement that does not lock suppliers out of the supply chain (sensibly no delivery date offered for this goal). All of these steps have been proposed by the government to improve SME access to public procurement opportunities.
Is this a new dawn for public procurement where smaller suppliers prosper and the government also buys more for less?
When answering this question it is important to bear in mind that the same Francis Maude who announced these measures (along with others) at a recent “Summit for Small Business” spent much of the summer locked in talks with the government’s 19 largest suppliers hammering out deals that will reportedly save the government £800 million on existing contract spend. It does not take the greatest cynic to wonder what these 19 large multi-national companies have been promised for delivering savings of this magnitude. Was it a world where their share of the shrinking pie was further reduced by taking work away from them and giving it to the SME sector?
It is also the same Francis Maude who praised the review of government efficiency carried out by Sir Philip Green that basically concluded that big is better and that suppliers should be squeezed until the pips squeak. Sir Philip’s review appears to have been placed to one side with Lord Young (of Health and Safety reform fame but now Lord Sugar’s replacement as “Enterprise Tsar”) recently pointing out:
“We are not running a business, we are running a country.”
and the government confirming that it would not be dropping the commitment to pay suppliers within 5 days that so riled Sir Philip. However, Mr Maude’s initial enthusiasm for the review’s findings does highlight that we cannot necessarily always expect to see delivered what is promised at industry events to that particular industry or sector.
While nothing new (indeed this week we have already seen BIS have to confirm that a review of TUPE for the voluntary sector reportedly announced by Minister for Civil Society, Nick Hurd, is not actually happening), this uncertainty as to exactly where government procurement policy is going does add to the problems currently facing authorities across the public sector. For example, Communities Secretary, Eric Pickles, recently called on all councils to “put every aspect of service delivery under the microscope” with an emphasis on “creativity and innovation”. Getting to grips with the practical and legal issues involved in completely reforming the way services are delivered, for example by looking to share services with other authorities, already presents enough of a challenge, but, by setting this challenge against a background of a moving regulatory environment, it is being made unnecessarily harder.
The government needs to stop announcing reviews as a means of appeasing industry groups or the general public and promising to “investigate” ways of reforming the public procurement regime that are unlikely to be deliverable in the short term. It must set out a clear framework of actions that it will take so that authorities can plan with confidence what needs to be done to protect frontline services to the greatest extent possible while delivering the cuts required of them.