CIPS WEST WALES UK GOVERNMENT AND ITS EFFECTS ON THE PRIVATE SECTOR

Transcription

1 CIPS WEST WALES UK GOVERNMENT AND ITS EFFECTS ON THE PRIVATE SECTOR

2 SCALE UK GOVERNMENT(S) its plural contributes a huge amount to the economy? Politically it s a debate economically? My view is it is a huge stimulus to the economy even allowing for George Osborn cuts.

3 What is Government? 1980 s before Mrs T s agency-ation 40 Principal Government Depts 12 English Regional Health Authorities +Wales, Scotland and NI Local Government bodies

4 What is Government Now? Before recent cull? 21 Main Gov Depts, NDPB s, PCT s, 3 types of NHS trusts (only england), local Gov units, 300+ Universities and higher Ed units, 24,000 primary schools, secondary schools, 40 + police services, 13 Ambulance services, 60 Fire brigades, registered social landlords! (excludes buying consortia 50+) The loss of Strategic Health Authorities and PCTs in England before the cull in numbers terms may increase the number not reduce it with GP s taking on the role of the PCTs

5 CHANGE? It is constant, very hard for business! Where do we stand? Vince Cable in opposition wanted BIS (ex DTI) wound up he is now its Minister and strangely silent! UK likely it has (some) trained buyers but not in every institution some frankly have no idea!!!

6 Buying skills? Significantly improved over the years Government Procurement Service. Local government weaker but improving disadvantage of having councillors with agendas inevitable but can be destructive Colleagues in the EU express how lucky UK is in comparison with their own position!

7 EU issues Key point there MUST BE competition! Does business like this yes when its favourable! Gov brought in big five consultants (from early 1990 s) they did NOT understand the law or the implications of the need for competition (or the risks in not securing it!).

8 Finance / Directors Generalisation but they do not understand the EU procurement requirements caught by the EU law yet they very often manage procurement! Example current Government drive to renegotiate contracts don t understand such action may be illegal and challengeable change the basis of the original tender and it s a new contract which requires competition

9 Advertising Doctrine of sufficiency Does business read the advertisements Sadly sometimes no!

10 EU procedures Open anyone can bid Restricted two stage selection then award. Prequalification then tender Negotiated and competitive dialogue can only be used under certain rules its NOT a free choice DH consultants we don t do it that way in the private sector Your NOT in the private sector!

11 Examples Consultants fees on re-negotiation of contracts in DH linked to savings they made they calculated the savings???? What is a saving how do you work it out? Was it good for business DH lawyers asking if they could break contracts down to below the thresholds? Its illegal disaggregation!

12 EU tools Dynamic Purchasing system Electronic auctions (EU forgot the word reverse ) Framework agreements (this one is prone to huge cheating by UK public buyers tends to greatly disadvantage suppliers and particularly small ones!)

13 Pillars of the Treaty Non discrimination Transparency Equal access -Free movement of goods, services, capital and people Proportionality Mutual recognition ALL MUST BE RESPECTED often a desire to cheat by UK authorities

14 Where we don t help business (1) Almost always seek a single contractor close to never consider lots Do not give sufficient time as allowed by law for tenders always use the minimum time if we do! Use UK wide contracts when its not needed OGC buying solutions for example and often at terrible prices and service levels and insist on usage can be illegal

15 Where we don t help business (2) Ask for policies that do not relate to the subject matter of the contract and then do not read them Leicester City Council Mix Award and Selection Criteria its illegal! Ask for excessive insurances not related to the size of the contract Leicester City Council

16 Where we don t help business (3) Don t operate the standstill correctly / don t operate the award notice system correctly Leicester City Council Several layers of framework in the same area of activity I have seen up to 5 Leicester City Council Do not commit to our suppliers under frameworks and lock out others potential illegality

17 Where we don t help business (4) Run select lists vicariously to avoid the legislation potentially illegal! Use frameworks as a benchmark to undercut the framework agreements Buying agents add on an on cost that is not revealed and cross subsidise their running costs

18 Where we don t help business (5) Cross functional teams supported but often buy in a rush we plan budgets but not procurement links with finance not understanding both at Government and local level! Buy at the rush buy badly! Confuse price with costs Mix purchasing economics with other policies incorrectly

19 Big is best? Central Government was / is? Fixated with large IT and Construction contracts forgetting significant service contracts and that small contracts can be more critical. Fixated for a long time on PFI s and PPP s rather gone silent since late 2008!

20 Freedom of Information / Remedies UK is becoming more litigious in current recession / near recession what have they got to lose by challenging FOI extremely helpful to potential challengers New remedies directive makes challenge much easier, and can have contracts declared invalid! Leicester City Council.

21 National Audit office Review of Collaborative Procurement May % of Public bodies used framework agreements but Poor quality management information Failure to understand user requirements Poor market knowledge and collaborative options Lack of documented evaluations Suppliers charged a fee disincentive to collaborate Multiplicity of similar contracts

22 NAO continued 80% of authorities do not measure the cost of undertaking the contract (there is NO commitment on a framework to buy anything remember too!) NAO estimated that OJEU advertisements were unnecessary (yet firms tender to them - AT WHAT COST TO UK firms based on NAO figures? Min 12,500,000 max 90,000,000).

23 Cases (1) Calderdale Council SM 22Oct 2009 several breaches of EU rules, lack of transparency, supplier allowed 2 bids NI Waste Water Government won the case but it took 18 months and the incumbent and litigant had an extension of contract for 18months as a result Transparency need!

24 Cases (2) Canada Quote SM 2 Sept 2010 You may get the cheapest PC on the desktop but you ll just pass the cost of servicing somewhere else and your overall costs will go through the roof Veolia battles councils SM 2 Sept 2010 Swansea and Dublin seeking to ban Viola as a result of work in East Jerusalem- Illegal D thinks yes S thinks no subject matter of the contract?

25 Cases (3) Leeds v MEL SM 30 Sept 2010 implied contract, abandonment of a contract procedure without prior warning to tenderers of alternative processes started cost of tendering to MEL! Supply Management 22 July Steve Clark Renegotiating contracts without breaching requirements of public procurement law appears rather a tall order. Pressetext v Austria case (you cannot change the rules part way through the game!)

26 Cases (4) SM 22 July 2010 EU gives Bulgaria, Cyprus, Latvia, Portugal and Slovenia 2 months to implement the 10 day standstill period Westminster City Council SM 19 June 2010 two challenges to award of parking contract

27 Cases (4) York City Land case SM 2010 Land awarded directly to a housing corporation without any competition admitted error and reopened the deal. (Great Danger in ploughing on regardless)

28 Cases (5) Northern Ireland Water SM 1 April 2010 Pressure by Board to bend procurement rules the single reason why organisations have boards of executives is to uphold governance. EU public bodies have a unique role on keeping things legal- 5 senior executives had to go!

29 Cases (6) EU Commission broke its own rules SM 27 Aug 2009 falsely excluded an Italian tenderer asked to compensate the supplier. Helen Gilbert SM feature Buy in Bulk, CBI tells police also Philip Green report did they understand EU procurement law!??? I suggest not!!!! There are many, very many more such cases!

30 Last Comment Ken May interview (Head of Eastern Shires Purchasing Organisation) in April 2010 His comment The Commission sought to simplify the Goods and Services Directive they have failed spectacularly in this endeavour BUT if we had not cheated as a public sector the completion rules would not have been so harshly interpreted!