19 October 2006

The Confederation of British Industry says public-sector purchasers are lacking in skill and risk-averse. Rebecca Ellinor assesses the profession's response

Procurement is clearly on Richard Lambert's mind. To mark the 100th day of his tenure as director-general of the CBI, his organisation issued not one, but two reports scrutinising and criticising public-sector procurement.

Some of their messages were new and some old - repeated in the hope the government would take notice. Each was followed with a recommendation.So what were the proposals?

The CBI says public procurement is not yet sufficiently professionalised, is excessively risk-averse and "taxpayers pay dearly when it is categorised by delays and changing specifications". It wants procurement timetables set from the outset and "clear consequences" for those who fail to stick to them.

"Getting these things right should be a condition of maintaining tenure. That's the way it works in the rest of the world," a CBI spokesman tells SM.

It says more skilled people are needed and should be retained once recruited. However, it recognises there may never be enough to handle tricky partnerships. It suggests "sector-specific procurement 'academies'" be established to pool procurement and contract management expertise.

OGC head John Oughton says his organisation is already working with the Association for Project Management on how to develop the project and programme management skills of public-sector purchasers. In addition, CIPS, with the sponsorship of the OGC, is next month officially launching the Public Sector Faculty, an education and networking association, which will create communities of sector-specific professionals.

It has also refreshed its qualifications to include public sector units. Keith Trower, deputy chief executive, says the level seven executive diploma is "designed for commercial directors and CPOs".

The CBI believes commercial directorates are needed in all major public sector departments "staffed by procurement professionals able to make and close deals as the Department of Health (DH) has done".

Besides commercial directors at the DH and the Department for Work and Pensions, two more have been appointed at the Ministry of Defence and Department for Education and Skills.

The OGC agrees they have had a "significant positive impact", but does not believe commercial directors or directorates are required in all cases.

It says it is "taking forward" the work of Lord Sainsbury who wrote to Prime Minister Tony Blair suggesting accountability for procurement and the need for skilled external teams influencing procurements.

The second CBI report says the government's £150 billion-a-year purchasing budget should do more to drive innovation. But the government has no plans to set up a UK version of the US's Darpa agency, as the CBI hoped.

The OGC says it is however, "taking forward" the work of Lord Hollick who was asked by Blair to examine how can stimulate procurement innovation. His recommendations have not been made public.

It adds that by the end of February 2007, a joint OGC/Department of Trade and Industry team will have developed recommended approaches for finding and procuring ideas and innovation.

It seems the two factions agree on what needs to be done, but not yet how or at what speed.

SMoct2006