Procurement incompetence means Wirral doomed*

Another public sector procurement scandal hit the press recently – Wirral Council got a damning report from the Audit Commission around a contract they let back in 2008 for Highways Services.

There were a whole raft of criticisms, including the fact that the contract (with a firm called Colas) ran for a year before it was actually signed, but the one that got most coverage was the “relationship” between a key council official and someone within the firm that won the bid. It was only after the event that the official, David Green, the council's currently suspended Director of Technical Services, disclosed the “relationship”. (It may be that the relationship was no more exciting than meeting the contractor prior to the formal procurement, we should point out).

There’s no suggestion of monetary reward or corruption – it appears that the winning bidder won on objective grounds, although there was some confusion about which costs were or were not included in the pricing. But it’s another example of why we have to keep vigilant, and why we do have public procurement processes and regulations.

In my time working as a consultant to the public sector, I was surprised that issues around conflicts of interests weren’t taken more seriously in some organisations – although I’d say the same thing applies in the private sector too. I remember one very high profile programme I worked on where there was some surprise that I insisted on getting everyone involved, up to and including the Chief Executive, to sign a conflict of interest declaration.

I’m not suggesting you do it for everybody who has any involvement in even the smallest procurement activity, but for cases where the value, risk or criticality is large, and where you’re in the public eye, then it really is recommended. And make sure you draw it widely enough – for instance, it shouldn’t just cover the individual having a shareholding in bidding firms, or other connections, it should cover family / partners as well.

It’s far better that someone declares something that may be very minor, which can then be assessed in terms of their role, rather than featuring in the pages of Private Eye – or Spend Matters – some time later! And now Wirral are in trouble for another contract – here’s the Wirral news;

The council's audit committee was told that senior officers knew Northwich UK was in serious financial difficulties but handed the company the contract to carry out £750,000 repairs to the West Kirby marine lake without telling councillors of the problems. Eventually, Jones Bros Civil Engineering, completed the repairs after Northwich UK pulled out following the decision by its parent company to wind it up in April 2009. But according to the auditor's report, Wirral council officers had an external credit report in January 2009 "that highlighted significant financial concerns in respect of the original contractor and stated there was a very high likelihood of business failure".

Have they heard of procurement in the Wirral? Was there any professional procurement person working for the Council? What on earth was going on here?  Anyone want to comment?

*say it out loud.. I thought it was quite witty anyway...

Voices (2)

  1. John Brace:

    >Have they heard of procurement in the Wirral?

    Yes, but large contracts are decided by either a councillor or councillors. In the case of the West Kirby contract it would’ve been the joint responsibility of a previous Cabinet (ten councillors) and the relevant Cabinet portfolio holder. You can probably (if you have enough time) find the minutes/reports of the meetings at which the decisions were made on Wirral Council’s website.

    >Was there any professional procurement person working for the Council?

    Yes, there was.

    >What on earth was going on here?

    There was a breakdown in communication between departments and vital information was left out of the report (among other things). Also for reasons of commercial confidentiality most tenders/contracts are decided without the public and press present.

    > Anyone want to comment?

    I remember talking with the Cabinet Member for Streetscene and Transport Jean Quinn at the time about it years ago. However she left as a councillor a while ago….

  2. Ian Thompson:

    Thank you Fraser… “Wirral doomed”

    Peter – interesting to reflect on your thoughts about procurement in the public sector – having just started in a very small way as a Parish Councillor and having made a commitment after taking a couple of quotes, I selected the supplier I believed was best able to satisfy our requirements. I can see now that viewed from outside I probably have not completed a full procurement process. I think I will subscribe to your blog for future guidance!

    Ian Thompson

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