Regional Growth Fund – Controls Lacking, Another Area that Needs Procurement Disciplines

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As government expenditure falls in many sectors, some suppliers might be asking whether it is worth going through the whole tedious process of looking for contract opportunities, bidding for a contract via a lengthy and complex tender processes, where you will be up against other potentially good firms, and then of course actually having to deliver the work at a margin that by now is probably pretty thin.

No, it feels like there might be easier ways of getting money out of government these days.

The first is the good old route of corruption – get yourself in via your connections, that might be just who you know or it might involve bank accounts in the Cayman Isles. We’ve featured a few very dodgy “single tender” contract awards here over the years, not just in Defence where often there are limited numbers of suppliers, but in areas such as consulting services where really there is no excuse for lack of competition.

The second route which we discussed recently in the light of the Kids Company events is to become a charity, have a brilliant public relations “front”, seduce (emotionally) a few politicians and celebrities, then watch as the money rolls in. Yes, you might have to actually do a bit of work, but no-one is going to contract manage you in the sense they would if you were providing cleaning services or packaging products.

The third route is to become a recipient of government grants. That is what has triggered this rant; the recent story that the UK government’s Regional Growth Fund, designed to support firms who are creating jobs, is an even bigger shambles than the National Audit Office had previously exposed. Last year, the NAO found that the cost of each job created was £52,000, which did not sound like any sort of value for money.

But now it has become clear that the fund has not been managed with the rigour that we might expect. As the Times reported:

“Unused funds from withdrawn awards have generally been used to increase the funding for later rounds of the RGF or to fund exceptional RGF awards. It is not possible to track the precise re-allocation of funding released specifically from withdrawn awards under each round.”

So again, we see government money – but NOT conventional “procurement spend” - that does not appear to have the same disciplines (evaluation of the “supplier”, tracking of costs, analysis of performance or deliverables) that we would hope to see in a more standard procurement scenario. As we say, why bother being a supplier? Set up a charity, apply for Growth Fund grants, get friendly with a politician or top public executive – they seem to be easier ways of making money!

And you can donate to the our charity, which is already bidding for £27 million in BIS grants, the Foundation for Aiding Retired Supply-Chain Employees  (FARSE) here via our Twitter account @easygovmoney...

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First Voice

  1. Barry Henniker:

    Peter this is just the tip of the Iceberg. For a bit of light relief check ot the pedigree of the CCS framework RM 3742 – awarded to a single supplier, an SME, which was spun out of CCS in the first place.

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