Margaret Thatcher, public procurement pioneer and advocate?

Margaret Thatcher, who died today, was the United Kingdom's most important politician of the last 50 years. She will be remembered for both her domestic leadership, as she turned round what seemed like a country in inexorable decline through the 1970s, and her role in foreign policy, from the Falklands to supporting Reagan in the "defeat" of the USSR.

But she can also take some credit as one of the key founding fathers (mothers?) of professional public sector procurement. Under her period of office as Prime Minister, 1979 - 90, we saw major advances in procurement throughout the public sector.  As David Smith, Commercial Director at the Department of Work and Pensions, CIPS President last year and someone who was one of the pioneers of public procurement himself, said to us today:

"She was really the first Prime Minister in the UK to take seriously the whole concept that government spending needed to be efficient and effective. She instigated the first government procurement review in 1984, which really led to the Treasury Central Unit on Procurement being formed, more senior procurement staff in departments, and eventually OGC, ERG and all the focus we've seen since on public sector procurement".

She also led the drive to involve the private sector more in the delivery of government services. Now, just like the more divisive side of her achievements on the economic front (miners' strike et al), you might look either positively or negatively at "compulsory competitive tendering" and "market testing" as the beginning of the whole outsourcing boom and greater private sector involvement in public services.

But if you remember the days of the local authority works' departments, and their total lack of any customer or VFM focus (and often a dollop of corruption to go alongside that), then it's hard to argue against her view that competition and procurement had to be taken more seriously if the taxpayer was to receive value for money for an ever-increasing investment.

And as well as being arguably the inventor of public sector outsourcing, it was under her leadership that the first serious Procurement Directors started appearing in government departments. I did my stint as a government CPO not long after she'd moved on, but her influence was still clear in the approach of Ministers like  Peter Lilley and Michael Heseltine, with their support for further innovative procurement initiatives around outsourcing and PFI for instance.

As David Smith said today,

"Whatever you think of her politics, she was a friend of the profession, and a genuine pioneer in understanding the importance of the role in the public sector. Many of the things we take for granted now in public procurement started because of her".

RIP Baroness Thatcher.

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Voices (11)

  1. Doug Else-Jack:

    Always enjoyed watching the Wizard of Oz with the kids, now another reason to smile knowingly and still not speak ill of the dead!!

  2. Alan Pattison:

    Best of all she triggered the shortest ever top 10 single.

  3. life:

    Except conservatism also split upon her. Many of the people I’be spoken to are split themselves. As a Thatcher child, I recognise Russell Brand’s (yes, Russell Brand’s) sentiment ( in a social sense, yet am adult enough to acknowledge as a business person that I suspect I couldn’t function as I do now without her. I suspect history may say, economically she went far but not far enough. She smashed too many eggs for too small an omelette.

  4. Dan:

    The real problem, I think, is that ‘Thatcherism’ moved on from being a solution to Britain’s problems in 1979 and became a philosophy that was claimed to be the solution to all economic woes – the IMF insist on policies that could be called Thatcherite on all impoverished countries that request a loan from them. It was never really challenged by those that came after, and led inexorably to the current crises (housing, social, economic etc), to the point where ‘Thatcherism’ and ‘Conservatism’ are largely interchangeable.

  5. Guy Allen:

    An excellent set of comments that I am happy to align myself to. Our nation needed to change, and some dramatic shift was needed, but there should have been a plan B to support those devastated communities.

    A cruel woman, I shan’t be mourning Maggie either.

  6. David Atkinson:

    Wonderfully accurate comments.

    I remember the late 70s and the unions didn’t run the country, but neither did successive governments. Someone like Thatcher was needed to break the log jam, but we didn’t need a decade of it.

    Everything Thatcher was lauded for (e.g. right to buy) had consequences that our society continues to pay the price for. All the policy changes (and referred to by Dave Orr above) weren’t all of her own making but her government successfully changed this country and social paradigms ever since. Much of what they did was dispicable and truly damaging to the country and the people who live in it. For Christ’s sake, how can you build global competitive advantage on a mountain of state and personal debt?

    I didn’t mourn her expulsion from No.10 and I’m not mourning now.

  7. Trevor Black:

    I worked in environments where the unions were too powerful and destroyed the business I was working in and on the other for an organisation where unions were desperately needed to counter the cruel and arrogant senior management where they sacked decent hardworking employees just because they could. Attacking extremes in unions was all very well but it did nothing to support those who desperately needed protection. I admired some of her leadership qualities but using Scotland for R & D purposes for the poll tax set the foundations for independence and explains why there are no longer conservative MPs north of the border. Lord Stockton warned of selling off the family silver, now that has gone and we have continued selling England by the pound. Anyone waking from a coma after 30 years could understandably believe that our banks, public utilities, energy suppliers and railways are being run by the mafia and not for the public good. We are now morally and financially bankrupt and that is partly due to what we have inherited from the Thatcher era. To paraphrase ‘Animal Farm’, “Industry bad- Services and Banking good”. I don’t think so!

  8. Roger Conway:

    I’m with Dave Orr here. It is all too easy to get carried away with jingoism of saluting a victorious war leader and there is no doubt that others that have followed her into No10 would have caved in to the Americans and given the Falklands to Argentina (yo Blair!). So thank you to her for that.

    There is also no doubt that TU reform was long overdue by 1979, especially in the heavy industries, but as Mr Orr says, to destroy whole communities, cultures and livelihoods without planning for their futures was callous beyond comprehension.

    If she had gone immediately after the Falklands, then I might have been able to morn her passing. But she didn’t and went on to inflict unbelievable damage to the fabric of our nation. She reduced society to a grubby game of walking all over each other to reach the top of that money pile, no matter what the cost. She simply did not understand economics and how it applies beyond the micro and insular private gain option (I say this as someone who taught economics for 30 years) and she allowed soft touch and deregulation of the financial markets to reign supreme with the consequences we see today.

    An odious woman, who put back the cause of women in politics for decades.

  9. Dave Orr:

    I spent the 1980s in the SDP as a fan of Dr David Owen and when he quit the SDP, so did I. I guess that makes me an idealist then.

    Mrs Thatcher is the ultimate “marmite” politician isn’t she?

    1979 & Winter of Discontent – Don’t want to go back to that (I was 25). Or the state GPO (now private BT) allowing me just two types of “approved” phones in just three colours. Or studying for O levels (now GCSEs) by torchlight if not one of the 3 days with electricity.

    Did the UK use it’s North Sea oil money wisely at this time? See Norway.

    But has the post-Thatcherite (she is notable by being an English noun as Thatcherism and an adjective of being Thatcherite) pendulum swung too far?

    Do light touch or self-regulated markets know best and are they working for us now?

    Is there a direct line between removing capital controls, de-regulation of the financial sector and large-scale offshore tax avoidance and the 2007 banking crisis too?

    Whilst the old smoke stack industries may have needed replacing, what was Mrs Ts “Plan B” for the communities and people who worked in them e.g. Corby?

    Is there a connection between 2nd & 3rd generation families relying on welfare, because market forces (expressed through a narrow measure of the M3 monetary supply) decimated their local industry & employment and the “state” did not take a strategic role in attracting alternative industries, re-training & re-skilling?

    I am not for 1979, but I am for returning some key infrastructure with national strategic importance to some form of post-Thatcher state control – starting with energy! Followed by rail, whilst retaining control over roads and health care.

    Only the state will invest over a long horizon e.g. 40 years. Right now, UK PLC can borrow cheaply to invest in nuclear power stations. for example. But current ideology and dogma is such that here in Somerset, we will not use UK state funding. but will opt for more expensive French and Chinese state funding!

    EoN have closed large coal-fired generating capacity at Didcot and the dumb contract doesn’t require them to replace the generating capacity. The lights can go out and the state retains that risk, thus proving that the privatisation failed to transfer that strategic risk to the private sector.

    Beneficial competitive forces diminish with cartesl and monopolies.

    Does that show that no-one can write a future-proof contract over a long period of time when change is highly likely and there in un-predictability?

    PFI is totally dis-credited but remains in use.

    Outsourcing is outsourcing, underpinned by a complex & inflexible contract, whether you re-brand it as “strategic partnering” or “commissioning”.

    No-one – Not Thatcher, not Major, not Blair, not Brown, not Cameron has even found the holy grail of “the best of the public sector, married to the best of the private sector”.

    Right now in our post-war NHS (setup by the great PM Clem Atlee), that experiment is getting underway….ooh err!

    Who said this “We have shown that orderly planning and freedom are not incompatible”?

  10. Lisa Reisman:

    What a thoughtful tribute – let’s hope her procurement legacy, in addition to her public policy contributions live on…

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