pension333: 'Incomplete' MPs' procurement report fails to consider the frontline

Change can't happen if Pasc doesn't take evidence from those dealing with procurement procedure on a daily basis

The Commons public administration committee report on government procurement, published on 19 July, contains some sound recommendations, although few which haven't been made before.

It calls for clear public procurement strategy backed by comprehensive data. There is undoubtedly scope to reduce the time taken to award many contracts, and to further centralise procurement in some categories while still encouraging participation by SMEs and social enterprises.

However, the evidence considered by the committee, and the analysis contained in the report, is both incomplete and weighted towards the supplier perspective. It is all too easy to blame EU directives and inefficient civil servants for the UK's procurement shortcomings. It is more difficult ? but ultimately more instructive ? to consider how procurement strategy interacts with the realities faced by frontline procurers, and to involve them, as well as suppliers and the third sector, in developing policy.

Pasc took evidence from representatives of business, small and medium-sized enterprises (SMEs), the third sector, procurement and commercial advisors, commentators, academics, Cabinet Office minister Francis Maude and senior Cabinet Office staff. It did not take evidence from those who conduct procurement procedures on a daily basis, either at individual departments or the National Procurement Service. This means a key perspective is missing from the report, and one which is essential to implement any changes to the way procurement is conducted in the UK.

The report criticises "unnecessarily strict adherence to process" and laments that the EU remedies directive has encouraged this, but does not have any clear alternative. As several of those giving evidence to the inquiry pointed out, the EU directives have encouraged a more professional approach to procurement and, if they didn't exist, a plethora of organisational, regional and national procedures would prevail ? creating a bureaucratic jungle for suppliers and procurers.

Suppliers like to complain about procedures when they don't turn out well for them, and the media and parliamentary committees like to draw attention to those that fail or take too long. It is right that poor procedures and outcomes should be criticised. But critics should bear in mind that public procurement is an administrative as well as commercial function. The imperative to move quickly and get the best deal must be balanced against the imperative to demonstrably spend public money in a responsible, transparent and fair manner.

More disturbing is the report's implication that other EU countries such as France and Germany are better both at conducting efficient procedures and in awarding contracts to domestic suppliers. The evidence for the second point is extremely tenuous, drawing heavily on the much-lamented fact that Bombardier did not win the Thameslink rolling stock contract. Bombardier did not win the Thameslink contract because it did not submit the best bid. That this example has been used over and over to criticise the way procurement is conducted in the UK seems ridiculous. The idea that other EU member states award more contracts to domestic suppliers simply isn't supported by the figures.

The most recent comprehensive study of cross-border contract awards in the EU, covering contract awards published in the official journal between 2007 and 2009, shows that the UK spent less than France, Italy and Spain on contracts awarded to companies based in other member states. The UK ranks very near the average for all EU countries, with 3.0% of the analysed contract spend going directly cross-border and another 13.8% indirectly through affiliates. Meanwhile, UK companies are among the most successful in winning cross-border contracts, ranking second after Germany with 17% of all direct awards in the sample studied.

In terms of the length of time taken to conduct procurement, the UK does come in at the longer end of this scale: an average of 161 days from publication of a contract notice to award, compared to an EU average of 108. Choice of procedure is important, but reducing the time taken to award contracts must not become the sole factor influencing this decision.

The report highlights that only one of 17 departments has met the Cabinet Office's targets for transferring procurement spend to the GPS. Rather than viewing efforts to centralise procurement in isolation, it would make sense to compare other attempts to centralise common departmental functions, such as property management or training. In order for such arrangements to work, the benefits of cooperation must outweigh the costs both for individual departments and government as a whole.

Finally, it is regrettable that the report focuses solely on central government departments, which account for �45bn of the UK's annual �227bn procurement spend. Comparison with procedures and outcomes in local government, the NHS and devolved administrations would have helped to identify which challenges are particular to Whitehall, and which are shared across the UK public sector.

The upcoming changes to the EU directives afford an opportunity for all EU countries to refocus procurement strategy. The Cabinet Office's efforts mean that the UK has a running start on this, but no one would argue that the job is done yet. Rather than yet another one-sided report or policy, which is doomed to go nowhere, why not start talking to government procurers directly? It is they who will determine the ultimate success or failure of strategy.

Abby Semple is a consultant at Public Procurement Analysis

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Source: http://www.theguardian.com/public-leaders-network/2013/jul/30/incomplete-pasc-procurement-report-frontline

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