How many contractors does it take to change a lightbulb? Well, if you’re talking about the NHS, the answer would be “many” – at a cost of £70.
That, at least, was the joke doing the rounds back in 2018, when outsourcing giant Carillion went bust, exposing a culture of waste and remarkably ineffective profiteering. Cue tabloid outrage, which is not something you can say often in the world of public sector procurement.
But, if the more recent scandal concerning the so-called VIP lane for preferred suppliers of personal protective equipment during the Covid crisis has shown us anything, it’s that there is always room for improvement on standards. Hence the government’s procurement bill, a package of reforms that’s in the final stages of its parliamentary journey. Enactment is slated for H2 2024, pending further consultation.
What’s in the UK procurement bill?
So, how does the government plan to go about improving public procurement? And what does the bill mean for those outside the public sector? One briefing note on the bill describes how it will “replace the current bureaucratic and process-driven EU regime for public procurement by creating a simpler and more flexible commercial system that better meets our country’s needs… delivering better value for money… [and] slashing red tape”. (Missed out any other manifesto lines, fellas? Oh, yes: lob in a reference to levelling up by way of “requiring contracting authorities to consider SMEs” and job’s a good ’un.)
Standards never stay neatly in one contract-lined box
The politics of post-Brexit procurement aside, the bill does contain some meaningful changes. For one thing, it does away with the five existing procurement procedures derived from EU rules. It replaces these with three streamlined options: direct award; a single-stage competitive tendering process without restrictions on who can submit; and any other competitive tendering procedure that the contracting authority feels is appropriate.
If that sounds rather laissez-faire, that’s because it is. And to guard against abuse, the government is simply updating the guidelines on transparency and shifting the awarding process to a digital platform – an idea that has been around for more than a decade. As a result, contracting authorities will be required to publish notices at various stages of the process, including details about a supplier’s performance against KPIs; any payments the supplier has received under public contracts; and the final terms of any £2m-plus contract. But let’s get real: a few extra bits of documentation are hardly going to do the trick.
Without high standards across the board, the bill can’t help
Granted, new powers to root out abuse or instances of poor value for money may well help, and the bill enables authorities and ministers to debar, exclude and remedially set aside misbehaving suppliers like never before. But, as the opposition has pointed out, that very much relies on officials behaving irreproachably. At the risk of appearing cynical, may I direct your attention to the Covid VIP lane once more?
As one supply chain and procurement consultant I spoke to recently put it, there’s even a danger that awarding authorities could end up “taking the big suppliers’ claims about modern slavery at face value” because the system is still awaiting the injection of rigour it needs. “That”, he said, “is still a way off.”
To return to the question of why this matters to the business world, it’s worth remembering that standards – whether they cover transparency, value for money or the enforcement of performance targets (including, for instance, ESG objectives) – never stay neatly in one contract-lined box. Institute a set of rules in one sphere (the public sector), and the behaviour learnt while aligning with those new rules will gradually bleed across into another (the private sector). That is great news if the rules are rigorous, but less so if they aren’t.
That’s why, once the bill is enacted next year, businesses might have to brace themselves to do more of the heavy lifting than they’re used to. Without stronger legislative action, that will be the only way to maintain high procurement standards and thereby prevent another Carillion-style scandal from striking again.
