Tuesday, 28 August 2012

Innovation scorecards

Public exposure of MPs expenses and the resulting scandal led to a belief that greater visibility of how public money is spent would lead to greater value for money.  This would be achieved as a result of an army of 'armchair auditors' leaving no stone unturned in their scrutiny and calling to account those who fail the test of good public stewardship. As if that would be suffice, in parallel the Audit Commission were stood down and CPA/CAA scores deemed unnecessary.  I have never met anyone who has taken the time to look at the published data on central or local government contracts over £500 and I suspect the cost of collecting and publishing the data far outweigh the benefits.  My own experience is that there is still a chasm to cross before the bland data published can provide any meaningful information.

However, it also came to light today that £36.4bn  is outstanding in late payments to SMEs over the year to July 2012.  With 1,011,000 SMEs affected that works out at an average of £36,000 each.  In turn that represents potentially quite a reasonable dent in unemployment statistics if that late payment were able to be channelled into salaries.

You may ask what is the connection between the NHS innovation scorecards and the late payment statistics?  Well to me the current publication of expenditure data has proved to be costly and an ineffective weapon in economic recovery.  Equally, we see an absence of innovation in public procurement in spite of the innovation in public procurement white paper having been published in 2008 and we have clear evidence that performance in paying debts isn't acceptable.  

My suggestion would be that rather than worry about publishing unheeded data on public spending and worrying about NHS innovation scorecards, why not shift the emphasis to public procurement innovation scorecards.  Scorecards which highlight how good a public procurement organisation is at adopting best practice, paying SMEs on time, and saving money.  Surely that would be more beneficial and push towards a tool which could actually assist with economic recovery.


  1. Good stuff Gordon - but the payment problem isn't the public procurement organisations, it's down the supply chain. The public sector needs to get tough with its Primes who aren't paying their suppliers.

  2. I can't comment on whether the costs of publication of spend over £500 are significant nationally. I suspect that for most authorities it is a relatively trivial task. I do agree that the idea of an army of armchair auditors beavering away to analyse whether spend profiles are appropriate or profligate was naive in the extreme. Apart from anything else, I seriously doubt whether it would be possible to make realistic comparisons of how different councils allocate their cash spend, even if the categorisation and information made available were significantly better than it currently is.

    Who does benefit? Possibly companies doing market research on where to pitch their tender for a new opportunity and would-be fraudsters keen to try and see whether they can divert supplier payments to their own accounts (http://www.bbc.co.uk/news/uk-politics-15660029 provides some details of which South Lanarkshire is one of the better known).