Francis Maude at PASC – select committee digs into UK government procurement

The UK parliament's Public Administration Select Committee held the final hearing of their investigation into public sector procurement this week, and appropriately their witness was Francis Maude, the Minister with responsibility for the subject.

As we’ve said many times, he is more interested in and knowledgeable about procurement than any other Minister we’ve had, and his hour or so on the topic was low key in style but quite illuminating.

He got some good questioning from Bernard Jenkin, the Chair,  but some of the other Committee members were poor in terms of their lack of any real insight or challenge. Here are some of the key moments anyway.

Maude started by claiming that the Cabinet Office has saved £5.5B last year and £8B this year. Not “helped the departments to save”, we note. This is one of the things that rightly annoys officials and Ministers about Cabinet Office - the way they are taking the credit for what is really a combined effort with the budget holding departments. A lesson there for procurement people everywhere actually as well in terms of stakeholder management.

Let's be clear.  Cabinet Office has promoted, assisted, supported, regulated and encouraged. Departments have made the savings. 

Maude continued his attack on departments who don‘t do as he wants them to. They got into the Sue Cameron Telegraph article and the DWP envelope stuffing equipment that we covered here. I do wish he would occasionally acknowledge even the possibility that some of the central deals aren’t the greatest thing since sliced bread, and maybe that is why they don’t get compliance, but I guess that is too much to hope for.

Jenkin (the PASC chair) quizzed Maude on whether the lack of buy-in to centralisation and the general agenda was indicative of poor leadership in the Government Procurement Service?  A good line of questioning and Maude wasn’t totally convincing. His response did include a comment that Stephen Kelly and Bill Crothers were relatively new to government.

Jenkin asked what is wrong with the structure of Whitehall?  Hasn’t the “silo” system of departments been proven over the years – why change now with this move to centralise?  We can’t afford not to, was Maude’s simple answer. Not very convincing, I thought – no comment for instance on the wider issues around such a change.

We then saw a debate about whether his view on the potential for a  “Crown Purchasing Agency” differed from the comments made by Stephen Kelly to the Committee previously.  It doesn’t, and it was annoying to see a Committee member here who hadn’t even been to Kelly’s session (or mine) trying to look clever now the Minister was present.  Anyway, Maude’s  response was sensible – we all know he is a believer in further centralisation, but he was clear that departments have to maintain responsibility for their own more unique and strategic spend categories.

However, he did go as far as to say that “smaller departments should not have their own commercial service”.  Well, you can certainly make that case but I could equally say “small departments should not have their own IT, HR, policy, Finance, Permanent Secretary, Minister....”.  Why not share those areas – why is it just commercial / procurement?

On SMEs, I thought he was good – interestingly, he was much less bullish on the target of 25% going spend to SMEs” (“it’s not a target, it is an aspiration”, he said in best Yes Minister style) than his officials were at the previous session, particularly Sally Collier. He confirmed that the data was lousy (as we keep emphasising) and rightly said that departments need to do more. No-one challenged him on the Ministry of Justice issue we keep raising which was a shame though.

But he was surprisingly honest on his views around “policy through procurement” initiatives. He was pretty dismissive of the Social Value Act - “it’s a permissive rather than  mandatory regime” he said. He sees procurement as getting “what you want at the best price”. He was OK with DWP encouraging supplies to take on apprentices “where it doesn’t interfere with good value”, but was generally rather lukewarm about this whole area. I have some sympathy with him, but is this an opportunity for Labour to differentiate itself in 2015 perhaps?

More in part 2...

First Voice

  1. Bill Atthetill:

    It is interesting that Bernard raised the topic of leadership. The Cabinet Office CPO role must surely represent one of the biggest procurement jobs on Earth, let alone in UK Government. Whenever a significant procurement role comes up in any high-performing private sector firm (like the ones that ERG aspires to replicate through its ‘greater commercialisation’ campaign) they always scour the world looking for the very best person to lead their procurement function. This philosophy is adopted across the vast majority of public sector organisations too.

    I can think of perhaps two reasons why Commercial Directors/Heads of Procurement across Central Government have dragged their feet over the last 2 years in respect of strengthening their reporting lines to the CPO.

    Firstly, the first ever CPO role in Central Government was only advertised across, erm, Central Government – they didn’t go looking outside for the very best, to test an external candidate against any of the potential incumbents – they took a short cut. I believe that only 3/4 (max) people went for the role – others, perhaps, decided not to because they already knew that Mr Collington was already the name of the door. He lasted a year. His highly publicised campaign “my boss is bigger than your boss” didn’t wash with his fellow senior practitioners across Government, who stood on the shore and, instead of throwing him a lifeline, they watched him slowly drown in his own sea of data.

    Secondly, following his departure, ERG declared that Mr Crothers was the best person that they could find (though, interestingly, he didn’t even apply the first time) and promptly put him in post. Mr Crothers was honest, of course, in declaring that his significant track record in CRM of circa 20+ years “in the commercial sector” (apparently Minister Maude uses this phrase to refer to the private sector…) dwarfed his relatively short career in commercial and procurement – all of it gained while within the Home Office family.

    The DWP could have taken a similar short cut by simply selecting one of a number of their existing talented practitioners in their own procurement community but instead chose to advertise. As we all know, they selected an external candidate.

    ERG should also have led by example and run a transparent selection process to attract the best procurement practitioner they could find. Perhaps they will get it right next time….

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