Cabinet Office procurement plans ‘could do more harm than good’

Peers warn prioritisation of competition over collaboration in public service commissioning risks compromising expertise and innovation
Peers criticised proposals to capitalise on post-Brexit freedoms from EU rules. Yui Mok/PA

By Jim Dunton

30 Jul 2021

The Cabinet Office’s post-Brexit plans to “simplify and speed up” public procurement pose a threat to good commissioning of public services because they prioritise competition over collaboration,  members of a House of Lords committee have warned.

In a just-published letter to Cabinet Office minister Lord Theodore Agnew, the Public Services Committee said the Transforming Public Procurement green paper fails to differentiate between the commercial purchasing of goods and commissioning high-quality services.

The committee, which is chaired by former Cabinet Office minister Baroness Hilary Armstrong, said it had heard in evidence that while the Cabinet Office has many procurement specialists, it has “little commissioning expertise”.

It also said the commercially-focused proposals in the green paper, drawn up to capitalise on the UK’s post-Brexit freedoms from EU procurement rules, are at odds with elements in the new health and social care bill designed to encourage collaboration between the National Health Service and local authorities.

Armstrong warned that if the contradiction is not rebalanced in the upcoming procurement bill, public services “could be subject to two contradictory legislative frameworks”.

She told Agnew that innovative long-term collaborations between councils and charities could be sidelined by the procurement rules,  while the green paper – published in December last year – has also failed to embed positive commissioning flexibilities introduced as part of the response to Covid-19.

“Procurement is founded on competition law, but commissioning should instead prioritise collaboration – whether between local government and the NHS, or the voluntary sector and statutory services,” Armstrong said.

“If it promotes competition over collaboration, the forthcoming procurement bill could do more harm than good.”

Armstrong added: “We remain concerned that the government’s proposals prioritise competition to the detriment of collaboration among providers of public services, give insufficient recognition to the important role played by the voluntary sector, fail to promote expertise in commissioning and do not align with the health and social care bill.”

Armstrong asked Agnew how the government will make sure those commissioning local services retain the freedom to determine how to best achieve social value in their area, without the introduction of excessive bureaucracy for service providers.

She also queried whether the procurement bill will include measures to fix the “dearth of commissioning expertise” in central government.

A Cabinet Office spokesperson said the proposed reforms would cut red tape, make it easier for smaller businesses to win government contracts and “unleash wider social benefits” from public money spent on procurement.

They added: “The measures also take advantage of new powers now that we have left the European Union and will increase competition through much simpler procurement procedures.”

This story was updated at 16:10 on 30 July 2021 to include a comment from the Cabinet Office

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