Public Sector Procurement: A Comparative Look at the UK and the US (Part 1)

Spend Matters welcomes commentary from Peter Smith, the editor of Spend Matters UK/Europe.

As Jason has been featuring US public expenditure this week, I volunteered to share some UK experiences in that area. I was the CPO for the largest non-military Government Department (social security) in the 1990s for three years and have worked as a consultant mainly in the public sector for the last ten years or so. That has included work at what you might define as the Federal and "state" level as well as with the health and police sectors.

I wouldn't claim that UK public sector procurement is perfect or anywhere near. There are issues of capability for instance -- some very good people but a lack of strength in depth. Use of systems and technology, and availability of data, is also patchy. There is less collaboration than there should be, and the European procurement regulations sometimes get in the way of what most of us would think of as best practice. perception is that the UK has made progress, and in fact has some experience that the US has lacked. For instance:

  • A number of national reports sponsored at the highest political levels that focused strongly on how better value can be obtained from procurement, going back to the Gershon report in 2004
  • A single organisation (the Office of Government Commerce), with a very senior leader, charged with driving better procurement (and project management) performance across Government
  • A process for independently reviewing all major Government projects
  • Procurement savings measured by most public organisations and reported centrally
  • A target that all public sector procurement will be electronic by 2012, which has led to a big growth in the use of platforms including BravoSolution, Emptoris, ProcServe, Proactis and others

Since the 2010 election, the new Government has brought some further ideas, including the transparency agenda Jason mentioned here. All local authorities (state, county, city in US terms) are required to publish all items of spend over £500. While there's a long way to go before this is done in a manner that is truly useful, the intent is a good start. And in a different initiative, a senior Minister has personally met with the top thirty or more suppliers to Government to negotiate value improvements. Savings of £800 million are claimed from this, although we will have to wait and see if they can be verified.

So it does seem as if the UK has perhaps done more to drive better government procurement than the US, certainly at a national level. Perhaps some of it has been more centrally driven than the very devolved US style would allow. In my next couple of posts, I'll look at what has worked well, and what has proved difficult, with a view of describing some of the critical success factors if the USA or Illinois is serious about making some savings from better procurement.

- Peter Smith

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