Reflections on the Transforming Public Procurement Green Paper

The Cabinet Office has published the ‘Transforming Public Procurement’ Green Paper and consultation. This Green Paper presents the government’s intentions to shape the future of public procurement for years to come: “speeding up and simplifying procurement processes, unleashing opportunities for small businesses and VCSEs to innovate public service delivery.” The consultation closes on 10 March 2021.

As a public sector procurement service working in the local government sector, STAR is always striving for continuous improvement, simplification of processes, and increasing our Partners spend with local SMEs. For the past 3 and half years, STAR has taken a risk based approach to below threshold procurements, and conducted these procurements in a flexible and innovative way that best meets the requirements, market, and risks of what is being bought.

This has improved access to local SMEs, with us seeing more local businesses winning our Partners contracts than ever before, and has driven the delivery of social value. We have achieved this whilst also delivering savings of over £30m, showing that this risk based approach also delivers value for money.  We welcome the Green Paper and the consultation, and believe it will enable us to expand and further innovate our approach to above threshold procurements.

Whilst there are still a number of areas that require clarification with a ‘clear regulatory framework’ yet to be defined, we set out they key themes in the proposals that we believe present a real opportunity for us to positively transform the approach to public procurement:

Creating a Single Regulatory Framework to replace the current 350+ regulations. This will help provide simplicity, and more importantly, provide clarity regarding legislation related to public procurement for both buyers and bidders.

The introduction of the Competitive Flexible Procedure, and reducing the number of available procedures, will allow for a more flexible approach to designing our above threshold procurement procedures to create better access to local SMEs, and the obtaining of Value for Money. We will be able to do this on a contract by contract basis, designing a procedure that is best suited to the requirement, market, and risks in question. This means that buyers will not be constrained unnecessarily when picking a procurement route and following its rules. We believe this, alongside the Open Framework, means the removal of the Light Touch regime and threshold should not cause too much disruption.

• However, this does mean there will be less standardisation of processes across the public sector, with bidders starting to see greater disparity between buyers of the procedures used, and the competition rules of how each procedure is conducted.

The creation of a single central registration system to undertake initial selection of bidders is a positive move. It allows bidders to input their information once (across the whole public sector), and only update as necessary, meaning they won’t have to manually repeat the information every time they bid, saving hours / days of resources every year. This also promises to create a more streamlined method for buyers in assessing the information and making initial selection decisions, hopefully speeding up the evaluation process and making public procurement quicker.  This, we think, is a development of the ‘European Single Procurement Document’, but we have never seen any bidder use this, so good promotion and supplier training may be necessary to implement this effectively.

Allowing the inclusion of award criteria that are not linked to the subject matter of the contract as well as opening up evaluation so that is not only from the view of the contracting authority has the potential to open up a range of possibilities. Clarity is still required on these matters, and there will be a tight framework to work within. Such a framework will be limited to Government strategic priorities and similar areas, but if this includes Social Value or furthering the delivery of the UN Sustainable Development Goals, this could create a significant improvement in our ability to include and obtain delivery of Social Value to local communities, regardless of what is being bought.

• There is some talk about this adversely affecting award decisions away from what is being bought and quality delivered, however, if we are to “Build Back Better”, we need to use the public purse to better serve and create advantages for our local communities. Having robust specifications that allow for innovation, and creating a proportionate weighting on such criteria will help ensure an appropriate balance is addressed. At STAR we have a ‘Social Value is Everyone’s Business’ campaign and we have had real success in delivering quantifiable Social Value through procurement. In 2019/20 we realised:
• 25% return secured on total contract values awarded. This equates to £31m delivered back to local communities through Social Value
• 20% average social value weighting across all procurements
• 57% of winning bidders are based in Greater Manchester
• 126 trainee and employment opportunities created

The creation of Open Frameworks, with multiple joining points for new bidders to place onto the framework, will create greater flexibility in replacing closed frameworks which lock out the market, or DPSs that are administratively burdensome and restrictive. STAR developed our own innovative approach for ‘light touch’ regime procurements through our ‘Flexible Procurement System’ procedure, so it is great to see that these same flexibilities could be applied to more of our procurement activity.

The new transparency provisions, whilst requiring more administrative resources to implement and update, will no doubt remove some of the barriers to SMEs and VCSEs in finding and bidding for public contracts. The amount of public contracts data that will be publically available will be unprecedented, and with contract performance data being made available, may also see an improvement in service delivery. With so much data available, we will need to ensure that this is published in a useful and co-ordinated way so local businesses and SME’s can find the data they need.

We are excited by the proposed new approach to public procurement.  There is clearly a lot of detail to work through and maybe not all the proposed changes will happen once they go through the regulatory process. However, it is great to see increased flexibility and simplicity, a focus on opening access to local / SMEs / VCSEs, and Social Value being applied more widely. These are all things that STAR has been developing internally and through these regulatory changes we will be able to do even more and have an even greater impact on our local communities.

By Michael Sellors: Procurement Business Partner