National Procurement Service of Wales: The BBC Gets Over-Excited …

At the end of last week, public sector procurement in Wales hit the headlines – well, in Wales anyway, as the BBC seemed (as far as we can see) to make a mountain out of a collaborative procurement molehill.

To be fair, there are some questions to be asked – and answered – about the National Procurement Service of Wales, the central collaborative procurement body, set up four years ago to “buy once” for the Welsh public sector, in much the same way that Crown Commercial Service (CCS) is supposed to be doing for central government in England.

A Wales Audit Office (WAO) report published a few months ago highlighted some issues with the NPS, and the future of the organisation is now being reviewed, as was always the plan we understand after this period of operation.  But this recent furore was sparked by a Welsh government public accounts committee hearing last Monday that considered the WAO report. Sue Moffatt, who leads NPS and also acts as the Commercial Director for the Welsh government attended that, but afterwards the BBC reporting seemed to go off-beam.

It suggested Moffatt had in some sense “stepped back” from her NPS leadership role because of the review or the WAO, and reported this in a great “shock horror” manner, getting various politicians excited about that as well. In fact, Moffatt stepped back from day-to-day running of NPS last October to free up her time to work on a major Brexit project as well as some other major strategic programmes in Wales. That had nothing to do with the review – which is an internal affair anyway, while the BBC report gave the impression that it was some sort of external “investigation”.

It is interesting though to look at some of those issues facing NPS. For a start, there are some serious politics around its operations. Central government has had its “toxic” problems and many local Welsh councils we are told don’t like working with NPS because it is seen as being run by central government (something CCS faces in England too).

Politics in Wales is complex too – see the map, courtesy of the BBC, for evidence of that.  Herding cats rather than Welsh lambs, we suspect …

And if we can make a contentious suggestion … maybe appointing an Englishwoman with a pretty direct style to lead the organisation challenged a few traditional attitudes as well?

Local councils have also raised issues about the lack of support from NPS to local suppliers. They would all like to give their business to local firms of course, then would get very upset if that same firm never won any work in the next town or county (because that authority did the same).  But this issue does raise some fundamental questions about the whole basis of national collaborative bodies, another issue for CCS as well, incidentally.

That’s not to say NPS itself has been perfect. For instance, customer satisfaction reported by the NAO certainly doesn’t look as good as NPS would have hoped. But in terms of the financials for NPS, spend through its contracts and frameworks has grown pretty successfully to £240m or so per annum. Remember, NPS has no mandate, no-one has to use their deals, so it is in a tougher position than CCS, or even collaborative bodies like NEPO and ESPO, organisations “owned” by member authorities who have a vested interesting in supporting them.

NPS has generated savings of some £15 million in the last year, well above its £2.8 million annual running cost - but with supplier rebates (which provide the funding) set at 0.5% of sales, it is not covering its costs. That is down to an over-optimistic initial business case – we’re told that “everybody involved knew it was optimistic” including Moffatt herself, which does beg the question of how it got approved! Wouldn’t be the first dodgy public sector business case, of course – and remember, CCS never even had one.

So, we can’t categorically comment on NPS or Moffatt’s performance, but this looks far from the disaster you might imagine from the BBC report. And she hasn’t stood down or stepped back because of the WAO report or the current review. This is a tough gig, given the political environment, but some simple steps such as increasing the rebate level would go a long way towards answering the criticisms – getting more of the users on board is the longer term challenge though.

 

 

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