Pub Debate Result – Are Suppliers Ripping Off Government?

So, we promised you the result of our pub debate held last week at the Clarence in Whitehall, where the motion being considered was “This House believes that large suppliers are still ripping off the government and the taxpayer”.  The aim with these debates is to be entertaining, but with some serious discussion and some useful ideas or thoughts that people can take away; I hope we achieved that goal last week.

Around 40 people were in the very pleasant upstairs room at the Clarence on Whitehall last Tuesday, overlooking one of the seats of government, the Cabinet Office, and just yards from 10 Downing Street. Following (broadly) the format used by the famous Oxford and Cambridge Unions, but without the gowns, and with beer, Allan Watton from advisory firm Best Practice Group proposed the motion. His firm has been involved in hundreds of failing outsourcing contracts over recent years, and he talked about what goes wrong, and the legal responsibility suppliers have to provide good advice to clients, and how often they fail to do that.

Procurement software experts and all-round good people Basware were our sponsors for the evening, so thanks to them for the refreshments, and for providing the first “opposer” of the motion, Paul Clayton. He suggested that there was evidence – from National Audit Office and elsewhere – that large suppliers to government do not make margins that are unreasonable or indeed greater than they make from their private sector clients. He also suggested that buyers had to take some responsibility when contracts did not go well.

I then supported Allan, pointing out the HUGE salaries private sector executives pay themselves, and the range of case studies (from Serco and G4S tagging to pharma firms and their recent exploitative scams on generic drugs) that show private firms ripping off the taxpayer through criminality, incompetence or inability to own up to their failings. Finally, Martin Webb opposed, talking about the need for buyer / seller collaboration and (supporting Paul’s ideas) how the government side needed to take more responsibility for supplier and contract performance.

After some very intelligent questions, we moved to a vote, and to my surprise and horror, the motion was defeated by a 60:40 majority. So, suppliers are NOT ripping us off, according to our audience.

I was genuinely surprised by that result! I thought our evidence of supplier bad behaviour would sway the delegates, but the line about collaboration and mutual responsibility that Paul and Martin took seemed to resonate with the crowd. Or perhaps a few people from the supply side had infiltrated the event – could it be a fake vote?! We demand a recount …

Thanks again to Basware, to the speakers, and to Caroline Cake of 2020 Delivery for chairing the event so capably and keeping us all (speakers and guests) in order. We hope to have more pub debates to come – everyone we spoke to really found this one stimulating, useful and enjoyable, so look out for more to come. And we will be back with two further articles to look at the arguments given during the evening, for and against, in a bit more detail.

Voices (3)

  1. Digby Barker:

    I understand arguments in the Pub debate context are expected to be short so with that in mind I’ll just say that a Supplier can only ‘rip off’ a Buyer if that Buyer awards them a Contract. So from a tax payer’s viewpoint the buck will always stop with the Buyer: “You set the requirement. You set the budget. You chose & implemented the procurement procedure. You knew what the risks were. You chose them !” Oh, and by ‘Buyer’ I don’t just mean the procurement staff: I mean the Authority as the legal entity responsible.

  2. David Atkinson:

    Well-meaning people, drunk on collaboration?

    😉

  3. Nick Drewe @ Market Dojo:

    Sounded like a great event, shame to miss out. The result is surprising – how many of the voters were buyers vs. suppliers?!

    With increasing spend data transparency, Government Cloudstore and the trend of poor practice rapidly propagating across the web, I’d like to think that there is less room for suppliers to hide.

    In the private sector however, it’s much the same as always where relationships can be more valuable than market differentiation.

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