Minister suffers as contract problems come to the boil

On Breakfast TV this morning there was a great example of how a procurement (or contract management) issue can suddenly become top of an organisation's priority list.

David Kidney, Minister at the Department for Energy and Climate Change (DFEC) was demolished by the BBC presenters on Breakfast TV over the Warm Front service, which provides Government money to old people to insulate their homes and replace boilers.  Apparently there have been complaints about the contractor, Eaga, and the service they provide; old ladies left without heating for weeks and so on.

I don't understand why the Minister didn't say (in terms of the specific example he was pressed on), "yes, I will personally ensure this will be sorted out today".  Then called his procurement director and told them to f*******g well get it sorted!  That's what I would have expected when I was a procurement head in a government department.

But anyway, there is a question of whether this is an issue of a Department running out of money, or a problem of contract management,  In either case, I suspect it has suddenly risen to the very top of  DECC's priority list.  And there is a classic supply chain issue; Eaga use over a hundred sub-contractors to actually carry out the work so interesting questions that come to mind include;

  • What do DECC's service level agreements and KPIs with Eaga look like?
  • What incentives and penalties are there in the contract such that Eaga are incentivised to ensure old folks don't freeze?
  • How do DECC manage Eaga and how do Eaga manage their sub-contrcators (passing on incentives and penalites thorugh the supply chain )?

And as DECC officials rush around sorting this one out, we might suggest a good exercise for any procurement person; which contracts that seem to be running OK could, if they suddenly went wrong, cause your organisation major reputational risk, and you personal angst?

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