Public services white paper – implications for procurement

The UK Government published their long awaited White Paper on public services this week.

The Paper is perhaps more of a discussion document than a firm road-map of how these things are going to be achieved.  For instance, there are still major issues, not really explored let alone resolved here, around TUPE and pensions that may act as blockers to private firms - or even social enterprises - taking on work currently done in the public sector.

The key elements of the Paper are:

  • A radical transfer of power from “bureaucrats” to services users through increased use of personal budgets, choice mechanisms, elected Police Commissioners etc;
  • Greater autonomy for frontline professionals through the removal of targets, inspection regimes and other top-down controls;
  • Opening up public services to new providers such as private providers, community organisations, social enterprises, charities and public sector mutuals; and
  • Commissioning for outcomes rather than process through increased use of payment by results mechanisms.

The media and commentators disagree as to how significant this all is.  Labour have positioned it as the start of a new wave of major privitisation (bad), while also pointing out that most of the actual initiatives mentioned were started by them! (Can't have it both ways, can you?)

Others have seen it as a watered down version of what was originally expected, in deference to the LibDems perhaps.  Certainly there is a lack of detailed actions, although it is radical in its direction in some areas, such as extending the right for citizens to choose in many areas, as in the case  of personal budgets for social care.

Anyway, we're not going to do a full critique here; there is an excellent paper from the Institute of Government here if you want to read more. But there are many and significant implications for procurement within the Paper. Here are a few obvious issues that struck us.

- Procurement may have to deal with more bidders from the third sector, social enterprises and so on. Traditional models of procurement may not work - or may not be acceptable - here. For instance, a charity or social enterprise may not have the financial track record a buyer might expect from a private bidder. And how can procurement reflect what is a clear political preference for this type of enterprise alongside the competitive and regulatory framework of procurement?

- There may be a push-back from firms who have lost out to nice cuddly "social enterprises", and a consequent rise in legal challenges. Again, a tricky balance to be struck.

- The workload may grow for procurement, particularly in local authorities, if more work is shifted out of the core organisation and there are more procurement exercises to run and more providers to manage. Yet budgets for internal teams, including procurement, will continue to be tight, one suspects.

- And (see above) all these challenges will mean that procurement / commissioning skills and capability become more of a key issue than ever.

- The divide between what is considered "procurement" and what is "commissioning" might also widen as these new paradigms come into play.

The Prince of Wales, Farnborough - a fine pub

We'll talk about this divide in another post, but the procurement "profession" is not guaranteed to be the recipient of the additional work coming out of these moves.

So, I'm off now to set up my social enterprise, and exercise my right to challenge current provision of services. I think I'll start by bidding to take over the work of the Surrey Heath pub inspection team...

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