UK local government procurement – Select Committee report published

The UK parliament’s Communities and Local Government Select Committee has issued its report on local government procurement following their multiple sessions, including one in the North of England that ace blogger Dr Gordy featured here.  Clive Betts MP, Chair of the Committee, said:

 “Procurement is too important to be viewed as a niche function conducted in back offices. It is central to delivering and managing the services that people rely on every day, from having their bins emptied to receiving social care. Without effective procurement local government will cease to operate.  We need investment now so that staff right across councils gain the skills needed for effective procurement. At times staff, unsure of the needs of local residents and business—especially small local businesses—fall back on wasteful bureaucracy. This has to stop.”

It is very good to see skills being put at the top of the agenda, a nice change after several years when most reports on public procurement seem to have focused mainly on aggregation and centralisation. The report's summary looks at a number of areas; here are some headlines and we'll get into the detail more next week.

Collaboration - £1.8 billion a year of additional savings could be made if councils improved their collaboration. The LGA should produce best practice guidance on the most effective means of joining up procurement to deliver savings. 

Adding social value and supporting small business - Councils must exploit the potential of procurement to deliver local priorities by letting contracts not just on the basis of price, but on the basis of wider social value. Councils should present an annual report to a full Council meeting setting out their strategy for incorporating economic, social and environmental value in its procurement, including the impact on local economies and small businesses.

The LGA should produce guidance on how procurement can be used to deliver social value, such as apprenticeships and trainee opportunities, and how it can better support small businesses.

Cutting costs to business - Councils need to cut burdens on local businesses, imposed in part by a culture of over-zealous application of EU procurement guidelines. The LGA and Government should clearly spell out what is a proportionate approach that will both meet EU requirements and streamline approaches. Paperwork also needs to be standardised, particularly Pre-Qualification Questionnaires.

Fraud and transparency - As more services are put out to tender local authorities are at much greater risk of fraud. Councils must not ‘let and forget’ contracts but should pro-actively tackle fraud throughout the lifetime of a contract, not just at the tender stage. More must also be done to encourage whistleblowers and an anonymous reporting channel should be created.

The LGA should consider how to increase the transparency of commercial contracts and local authorities should make greater use of open book accounting and consider placing similar requirements on information provision by contractors as apply to a public body.

Managing outsourcing - Recent failures of outsourcing arrangements in local and central government raise questions over whether all councils are taking adequate steps to ensure effective control of contracts being delivered by private and third sector organisations. The LGA should undertake an assessment of the level of contract and risk management skills and resources available across the sector...Councils should consider when letting contracts whether they wish to take into account a bidder’s policies on employment issues, including zero hours contracts...Councils must ensure that residents have a clear point of contact with external delivery bodies so that they receive a seamless service, regardless of who is delivering it.

More to come...

First Voice

  1. Dave Orr:

    Meanwhile the litany of failing/failed joint ventures continues with some very serious issues underlying the BT Liverpool saga:

    http://ukcampaign4change.com/2014/03/14/should-liverpool-council-smile-now-its-ending-bt-joint-venture/

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