Interview with Government Procurement leaders – Collington and Smith spill the beans

As we explained yesterday, we spent an hour recently with John Collington (Chief Procurement Officer for Government Procurement) and David Smith, his deputy and still Commercial Director for the Department of Work and Pensions. Over the next 2 days we’ll feature the interview in some detail, and then finish with our interpretation of how this high profile programme is getting on.

Collington did most of the talking with interjections from Smith – I haven’t tried to separate out their respective contributions here though; my note taking is not quite up to that I’m afraid.  My feeling is that they’re working together well, although I suspect as two strong characters, they don’t and won’t always agree on everything. And that’s not a bad thing...

So, why is this going to be different from all the other public sector procurement initiatives we’ve seen over the years?

The most significant change – and why we believe it will work - is direct political involvement and willpower. It’s not just senior civil servants, or even Francis Maude (the Cabinet Office Minster responsible for this programme) – this has real Cabinet level engagement and drive.  We’ve got a Minister who really ‘gets it’ and it’s going up to a Cabinet sub-committee on a regular basis. And that’s not just the centralised categories; this is across the whole £60 Billion departmental spend.

Then from a more delivery point of view, the Office of Government Commerce (OGC) always had the problem of being one step removed from the Departments when it tried to drive improvement or collaboration  – and Buying Solutions was another step away. Now we’ve flipped that – it is the procurement heads in Departments driving this. They can’t just take their ball home if they don’t like something – this is their/our initiative.

So the focus isn’t just on the centralised categories?

Not at all. That’s getting the most external attention as that’s our initial primary focus , but actually there will be a lot of activity around the department-specific spend, which accounts for £40 billion a year, and the £10 billion plus that goes through the major suppliers who are being addressed by the cross-government negotiation programme managed by the Crown Commercial Representatives.

I’ve heard Francis Maude is actually an expert on EU procurement regulations?

Well, he’s a lawyer – I wouldn’t say he spends a lot of time on that side of things, but he is deeply involved in and very supportive of what we’re doing.

So in terms of the centralised categories, who is actually driving that? Are procurement people coming out of Departments to form part of the GP team alongside the old Buying Solutions organisation?

Key staff from Departments will be involved alongside ex OGC and Buying Solutions staff on particular categories and in other work – but they won’t transfer. They’ll work as part of the GP team but stay with their Departments, so GP is a partly ‘virtual’ organisation.

So what about the contracts you’ll be letting with the new structure – the two we’ve seen going to market so far don’t look very different from old style Buying Solutions agreements?

Every category will be different.  I think one thing to note is that this won’t be a single large contract for each category that’s within scope. We’re not ruling out extending or expanding successful existing contracts if we can, rather than starting from scratch. There may be more than one contractual vehicle for each category; so different solutions for different Departments. The Procurement Executive Board will make this judgement.  We’re sensitive to Departments’ needs – we will develop a category strategy in each case that looks at the best solution, and the mandate is really mandating adherence to a category strategy, not necessarily to one contract.

What about SMEs? Again those two tenders don’t look very SME friendly?

I’d argue that splitting the office supplies into two lots is more SME friendly than if we’d split it into 4 or 6. With only 2, the Prime Contractors will have to use other partners in the supply chain – who may well be SMEs. If the contracts had been a bit lower value, the winning bidders may have managed them purely internally. And I wouldn’t rule out at this stage SMEs doing well in the travel tender.

But you’ll see different approaches for different categories – we’re excited about the emerging thinking in professional services for instance. In that area, you will see more open competition for major assignments, more opportunities for SMEs, and while there’s a place for frameworks, they have to be used properly and in a much reduced way. In energy, SMEs probably won’t win the big supply contracts, but they can work with us on energy initiatives.

What about use of the open procedure – we’re seeing it being used in a way that is negative for SMEs, with bidders being asked to complete a full PQQ and ITT in a single document? (See here for further detail).

That’s not how it should be used. We want to get rid of PQQs for under £100K tenders, use the Open Procedure more – this is all intended to help SMEs and help government procurement take on the principles of Lean Procurement – that’s another important aspect of what we’re doing. We talk to Stephen Allott regularly (the Crown Commercial Representative for SMEs) and we’re aligned on 95% of issues. The remaining 5% is what I would call healthy tension.

Stay tuned for part 2 tomorrow.

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