Julie Welsh, Director, Scotland Excel, gives her views on how procurement has changed over the last decade.
In some ways, it seems as if the ten years since the publication of John McClelland’s Review of Public Procurement in Scotland have passed in the blink of an eye. However, when you consider how much has changed since then, it feels like it was a completely different era when we started out on this journey.
And, of course, we are now in a new era for public procurement. The reform programme kick-started by McClelland’s report has transformed the very foundations of procurement across the public sector. We have moved far beyond the view of procurement as a ‘back office’ purchasing function, to one where teams of dedicated procurement professionals work alongside their peers to support the delivery of better and more efficient public services.
It is this strategic and collaborative approach that has underpinned everything that has been achieved by the programme. We have found the savings; we have found the efficiencies; and now we are expanding our horizons to see what more we can do.
What did the report mean for me?
When John McClelland’s report was published, I was Head of Procurement at Scottish Power, so it had no direct impact on my work. However, I was aware of the report and, as someone who believes passionately in the power of procurement, could see the potential benefits of the ambitious changes it proposed.
On joining the public sector in 2008 – initially with Glasgow Housing Association and later with Renfrewshire Council – I realised just how important the report was in driving real change within the public procurement landscape. This has not been without its challenges, but I firmly believe that the reform programme initiated by the report has brought a wealth of benefits to organisations, public procurement professionals and, most importantly, to our communities.
Of course, it is worth noting that Scotland Excel was established in response to the recommendations of McClelland’s report. So I can truthfully say I would not be where I am today if it hadn’t been published!
What does the local authority sector look like now?
As large, complex organisations responsible for the delivery of a wide range of public services, implementing the report’s recommendations was always going to present a challenge for local authorities. However, our sector has rallied to the call, as evidenced by the three-fold increase in average Procurement Capability Assessment scores between 2009 and 2014.
It goes without saying that the ability to make savings and efficiencies has been a key driver for change at a time of increasing pressure on budgets. But procurement delivers so much more than savings in the local government sector. With our minds firmly rooted in serving our communities, the benefits supported by procurement in our sector have made a real difference to the lives of people using local services across Scotland.
Take social care as an example. By working together, councils have been able to make budgets go further as demand grows. Scotland Excel’s social care frameworks are not about driving down price, but ensuring the sustainability of provision so service users can continue to receive care which achieves the outcomes framed by national policy.
Local economic development is also critically important to councils. That is why lotting has long been central to procurement strategies in our sector. Around 70% of suppliers to Scotland Excel contracts are SMEs, and two-thirds of these are based in Scotland. More than £400m has been spent through our current contract portfolio with suppliers located in Scotland.
Community benefits are a key driver for the local government sector. Since 2013, our frameworks have supported more than 260 jobs and apprenticeships, over 41,000 hours of work experience placements and a wide range of local charity and community initiatives. Further benefits have been achieved by councils through their local contracts.
The foundations for good procurement are now in place across the local authority landscape and the rest of the Scottish public sector. We have made real headway in using procurement as a driver of social policy and value.
Where do you see local authority procurement in ten years from now?
As always, procurement will continue to play a key role in delivering savings as budgets continue to reduce. The challenge will be to attempt to reduce costs whilst continuing to deliver social benefits to our communities.
Public sector procurers will need to build close relationships with suppliers to build in innovation to the supply chain. I believe this is the only way we will achieve the joint goals of savings combined with social benefits.
There is still room to achieve more and to help drive policies that make Scotland a better place to live and work. I expect to see community benefits in more contracts – not just the traditional construction contracts. I also expect to see more suppliers paying the Scottish Living Wage through our assessment of workforce matters. These things will make a real difference to our local communities, and I am very proud to be part of that.
Over the next few years, we must make a real effort to create interest in the procurement profession. We need a clear plan to encourage young people to join the public sector, and we need to deliver the training and development opportunities to retain them. At Scotland Excel, we are playing our part through successful Modern Apprenticeships in Procurement and our Graduate Trainee and Intern programmes. If we are to realise the full potential of public procurement, we all need to work together to attract new talent to this worthwhile career.
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