CBI positive about UK public procurement policy, critical of implementation

In a new survey, the CBI, the UK’s leading business organisation, takes a close look at the government’s progress in terms of their procurement reform agenda.

The report is based on a survey of 100 CBI member organisations, with additional analysis and comment. It’s reasonably balanced, I would say, and the way in which they have separated “policy” and “implementation” is very sensible. Indeed, that leads to what we might suggest as the single sentence summary of the report – “generally government procurement policy is heading in the right direction, but the implementation has been weak in too many areas”.

It starts with the depressing statistic that only 7% of respondents think public procurement is delivered well in the UK.  But reform is on the right track – the CBI gives the government 8/10 overall for “policy”. However, they only give 5/10 for “implementation”.

And that pattern is repeated for each topic area, some more starkly then others. So “Faster procurement” and “Simpler procurement processes” score 8 and 7 respectively in terms of the policy, but only 4 and 3 for implementation.

The policy intent to give better access to SMEs (small businesses) gets an acceptable, if not great 7, but implementation just 5, whilst promoting economic growth struggles to a 4 on implementation.

The CBI report then goes into a whole range of proposals and recommendations. There’s a somewhat naive stressing of the need to move from “conflict to partnership”, which as usual ignores the reality of EU procurement regulations. But I find it hard to argue with many of the 24 recommendations, and interesting to see them criticising the “number of procurement portals” which is leading to understandable frustration for suppliers.  We may come back to those recommendations in more detail at a later date.

But one point that struck us; there’s a sense of a problem we’ve mentioned here previously. There is a lack of joined-up-ness in some Cabinet Office thinking about procurement direction and strategy, which manifests itself in contradictory positions and initiatives. So a major programme of centralising spend is implemented, alongside an intent to help SMEs. Now I know you can strive to include SMEs on the large national contracts and frameworks, but there is a fundamental dichotomy that you can’t ignore.

Similarly, taking a strong line with suppliers in negotiations, accusing them of over-charging and so on might be a good move to drive out some short term cost savings  – but you can’t then also expect those same suppliers to work in partnership, or offer you preferred customer status in terms of great ideas and innovations.

There’s a similar element the CBI highlight that I hadn’t considered. Whilst the drive for Lean Procurement and targeting 120 days elapsed time for procurement exercises is admirable, apparently the target is leading to buyers simply reducing the time suppliers are given to put their bids together! Not what was intended...

And we’ve got another good example tomorrow of the law of unintended consequences, with a recent government procurement initiative that we suspect the CBI won’t like, and that we are confident will have consequences that Ministers don’t expect!

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