Thursday, 19 January 2012

To buy or not to buy? Caveat emptor!

A few days ago I wrote a very tongue in cheek blog: Minister admits Public Procurement Litigation Agency overspend.  While much of that blog was inspired by the media attention given to the overspend on settling NHS claims compensation, I could perceive a threat of a new business opportunity exploiting poor public procurement practice.

Today I was startled to find a new twist  in the NHS story as it was revealed
that NHS hospitals have been advertising 'no win, no fee' claims services.  NHS branded leaflets and a supporting poster campaign are apparently being distributed in NHS hospitals encouraging 'no win, no fee' claims.  In return for the advertising the hospitals are being paid fees, which in some cases amount to £85,000 per year along with an undertaking not to sue the hospitals where the advertising was placed.  You just couldn't make it up.

Anyway, this got me thinking about how it could develop insofar as public procurement is concerned?

Well many public sector organisations have produced:

  • Selling to ... Guides
  • Procurement websites
  • Supplier charters, etc.
These could be the equivalent of the NHS leaflets and posters - a place for selling advertising, targeted at  the public sector supply market and potentially generating revenue.  Of course not only are these procurement sites ideal, many other public sector 'spaces' are also available - for example, as an aside, I remember selling advertising space in a council's leisure centre so that revenue would be generated and reduce my council's costs. 

With very little poking around I've been able to uncover many procurement breaches ripe for challenge.

So we have an interesting scenario - a 'what would you do?'

Imagine you are a public sector buyer and you are aware that there are flaws/weaknesses/breaches in your procurement.   You are approached by the business development manager, of what we'll call, for the sake of illustration 'procurement challenge farmers'.

The business development manager presents you with a choice:

"Hey, you and I both know your organisation have made a number of procurement breaches of the law lately.  My organisation intend to speak to a number of suppliers who've bid unsuccessfully for your business and offer them a 'no win, no fee' procurement challenge service.  However, if you let us advertise our services in your Selling to... Guide and on your procurement web pages, we will undertake not to take any challenges against you.  In addition, because you're advertising this service, you will actually be perceived, by the market, as very confident that your own procurement processes are really good. You can't lose."

What would you do?

Background reading
Smyth, C.; and Sherman, J. (2012) 'NHS defied ban on adverts for no-win, no-fee lawyers', The Times, 19 Januray, p.3.

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