Rob Driscoll, Deputy Director of Business Policy and Practice at ECA, is also Business adviser to the Cabinet Office and Crown Commercial Services.
Cabinet Office Minister David Lidington recently announced plans to shift the Government’s approach to public sector procurement, by modifying the Social Value Act 2012. The Minister stated that the objective of this is to ensure that public services “work for... everyday needs, while providing value for money.”
This is part of an apparent realisation that, to improve commercial behaviour and increase corporate ethics and integrity, the feedback loop between procurement awarding processes and past performance is a key enabler of public-private success.
Significantly, Mr. Lidington said that to achieve this, “we need to build a diverse, vibrant marketplace of different suppliers - which take into account wider social values”. This development is extremely positive, and something ECA has made the case for to Government in recent months.
Respect, Inclusion and Diversity
As a firm advocate of respect, inclusion and diversity – including making the business case for how diversity can lead to profitability – I also welcome Government’s commitment to use its purchasing power (some £200bn) to challenge its major suppliers to do better on equality and diversity. I have long believed society’s expectations in the workplace can be wrongly based on demographic profiles, but if business is to work for society, it must reflect society.
The Minister also announced further measures, including:
- requiring key suppliers to develop ‘living wills’ (which will allow contingency plans to be rapidly put into place if needed)
- increased transparency for major contracts by publishing key performance indicators
- improved training for government procurers
- enhanced measures to protect suppliers from cyber attacks
This development is even more significant given the release of a new parliamentary report on Government outsourcing and contracting. The Public Administration and Constitutional Affairs Committee report found that “Government’s overriding priority for outsourcing is spending as little money as possible while forcing contractors to take unacceptable levels of financial risk.”
The report continued: “Contractors told us that the government was known to prioritise cost over all other factors in procurements, driving prices down to below the cost of the services they were asking firms to provide.”
I am fascinated to see what transpires in the near future, and whether these new measures will indeed bring more diversity to the marketplace and help begin to piece together the long road back to trust for large clients and contractors after Carillion’s collapse. We can only hope.