Procurement should not be a narrow corporate function restricted to local government, nor is localism its primary concern. It sits at the heart of what we want and need from our public services in the future. Of course it needs to focus on efficiencies, but effectiveness in supporting growth, addressing poverty and inequality and creating great places is the real prize.
This is an extract from an article by Matthew Jackson in New Start Magazine
The government last week published its findings of the inquiry
and an associated set of conclusions and recommendations. On first
glance, there is the same old, prosaic nature to them. They are missing
some key points. The recommendations point towards a need for local
authorities to use procurement to achieve value for money (efficiency); a
need to collaborate across boundaries (efficiency); a need to simplify
processes (efficiency); and a need to engage better with private
organisations on outsourced contracts (efficiency). Where is the
progressive virtuous ambition, which we and many others are so keen
For me, there is too much about using local government procurement to
achieve efficiencies and to mitigate the impact of the cuts as opposed
to advocating a progressive new future around local government
procurement being used for local economic and social benefit. The report
does not get to grips with what many in local government are doing. Manchester council and Belfast council,
amongst others, have used procurement as a lever to create local
economic wealth and importantly create jobs. In this, there are a
number of concerns.
First, procurement is not simply a transaction. It is a process which
goes right from the design and commissioning of a service through to
the monitoring of the impact of that spend in economic, social and
environmental terms. There should therefore be a defined understanding
of the key considerations of what an effective purchase is, regardless
of whether it is being undertaken by central government, local
government, an NHS Trust or a private business. Of course cost should be
a key factor, but so should providing a great future role for our
public services, as well as fairness, equality, and the opportunity to
create local employment and develop local businesses.
Second, procurement is not the same everywhere you go. Different
services and goods lend themselves to different means of purchasing and a
localised approach is not always the most efficient or effective. Some
goods in particular need to be purchased in bulk to enable economies of
scale (energy, communications, stationary etc); while others lend
themselves to a process where wider local economic and social value can
be achieved. There should therefore be a defined understanding of what
constitutes ‘influenceable’ and ‘non-influenceable’ spend.
Third, procurement is not just the domain of local government in
place. There are a range of anchor institutions within a locality which
purchase goods and services to a significant value (NHS trusts,
universities and colleges, housing organisations, police authorities,
and a host of others). There is a need for a place-based vision and
approach to procurement and the creation of wider local economic and
community wealth that sits across those organisations and importantly
local enterprise partnerships. Cles is currently working on such a vision
with Preston council and a range of institutions in the city to
increase levels of spend with local business and potentially create
co-operatives to deliver appropriate public services.
Procurement should not be a narrow corporate function restricted to
local government, nor is localism its primary concern. It sits at the
heart of what we want and need from our public services in the future.
Of course it needs to focus on efficiencies, but effectiveness in
supporting growth, addressing poverty and inequality and creating great
places is the real prize.