Maude criticises public procurement again – and Cabinet Office plans published

Of course politicians always do it, as do football managers or even procurement leaders.  Go into a new job, shake your head, and tell the world what a terrible mess you've inherited.  You can only do it for so long though before you invite the response, "so why haven't you done anything about it?".  And the other danger is that you can annoy the very people you need to help you sort things out - your staff / team.

So I wonder if Francis Maude is wise, in his Telegraph interview the other day, to be quite so critical of UK public sector procurement?  Civil servants can't answer back, so I'll respond on their behalf and comment on some of the points he raised.

From the Telegraph:

Maude prefers "incontinent" buying to "incompetent" when describing the behaviour of some of his procurement teams across Government.

I don't think I would want to be described as 'incontinent' or incompetent' frankly.  And somewhat insulting to a lot of good procurement people in either case.

"How on earth can you run big complex organisations like this when the data is so bad? Pure management information; how many [procurement] people do you employ, what do you spend on this, how much does that cost? Very, very important."

Data has improved considerably over the last few years; look at the success of firms like Spikes Cavell, Emptoris, BravoSolution in helping public bodies to get better data... most organisations have a reasonable handle on procurement spend.  Here's what OGC collected from the last financial year..  It could be better of course but it's not bad.

And I believe organisations do know how many procurement people they employ;again,  OGC collected that data for central Government some time ago for a start.  Another area where I don't think the picture has been quite as dreadful as is being painted.

Moving on to future plans, the Telegraph says that £400m a year is to be saved by taking procurement cards away from civil servants who have "spent money too freely in the past".  Where is the evidence that money has been spent 'too freely'?  It seems to me very naive to think that spend will just disappear; purchasing cards used properly can save a lot of transaction cost, so there is every chance this move will end up costing the taxpayer more.  So why do this?

Maude also claims (not for the first time) £800 million in savings from the negotiations with top suppliers.  But, while I know there are good people involved with this initiative (from Cabinet Office and Departments), we have no objective evidence yet of that saving; it has been deemed "confidential", and as we've said before, not a single supplier has warned their  investors of a reduction in revenue or profit as a result of this initiative.  So we need to wait for the National Audit Office (who will I assume fulfil this role at some point) to verify the success of this scheme.  But I do find it amazing that the press are not challenging a bit more on this issue and saying 'go on then, at least give us an example of a tangible saving'.

On a positive note, Maude said some sensible things about small suppliers (SMEs) and I was pleased to see that there does seem to be clarity now that the target is 25% by value of contracts to go to SMEs, not 25% by volume.  However, he doesn't explain quite how this will fit with the centralising commodity spend work, which is very likely to drive more business to large suppliers.

Finally, the Cabinet Office published its Business Plan yesterday; I will have a closer look at it, but just to note that Nigel Smith, who left his job as Chief Executive of OGC in August,  is STILL on the organisation chart!  Let's see if he can make it till Christmas... I hope they're still paying you Nigel?

Share on Procurious

First Voice

Discuss this:

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.