FoI for public sector contractors?

I have to say I was surprised today to hear of proposals that the Freedom of Information Act could be extended to embrace public sector contractors (quite possibility driven by a recommendation from the Social Enterprise UK ) .

I don't actually believe the rhetoric that such a move will force firms to compromise commercial secrets as, it strikes me, Section 43 of the Act already provides that protection. However, I do question how well thought through this potential policy is and what is likely to be the outcome?

Common sense suggests that since the Freedom of Information Act is now well embedded in the public sector it shouldn't be too hard to establish the potential value which would be delivered through the increased scope. For example, it would be useful to know how much cost has been added to the average public sector organisation answering FoI requests? It would also be comparatively easy to carry out some research with those who have made FoI requests to establish the real benefit gained? I have never actually made a FoI request but have had experience in responding. Responding to FoI requests consumes an enormous amount of time and there is a game of sanitisation taking place - a cottage industry has been created for bureaucrats. But equally many requests are just lazy, disguised market research at the expense of the public sector, it's information which isn't in the public interest but the costs are being shifted from the private sector to the public sector. Labour could place a FoI to get that information before pursuing the policy.

If the legislation is extended there will be an additional cost to private and third sector organisations just because they happen to be public sector contractors. There will then have to be some disaggregation of those organisation's work which is covered by FoI requests and which isn't. Those organisations being asked to respond to potential FoI requests will have to allow for that cost in their bids and that in turn will be passed to the public purse - those advocating the policy will need to budget for those costs. It may also be worth considering what the likely impact will be on mirco, small and medium enterprises?

However, if the issue is that the public sector isn't really on top of its contractors, then changes to specifications and contract  management may be more cost effective options.

Some months ago I discussed another Labour proposal, that of obliging all public sector contractors to pay the Living Wage. It strikes me that Labour can see public procurement is a useful political tool but I think it may be better to sit down with some sympathetic businesses and work out the most effective means as opposed to kite-flying.

Is it wise to announce a lack of confidence in your vital statistics?

Some months ago I wrote a cautionary and fictitious blog on a future Procurement Litigation Agency. Today we may have seen the first signs that may become a reality with the government effectively announcing a lack of confidence in its own financial models.

You will recall the recent  Rail Franchise fiasco, which led to the Minister having to admit, that despite previous reassurances as to the robustness of the procurement process, the vital statistics just didn't add up. The permanent secretary put it down to "a lack of proper quality assurance"! Clearly the Franchise has set the 'cat among the pigeons' and, so low must be the level of confidence in government calculators and spreadsheets that, an urgent review has now started to test the reliability of the Government's key calculations.  Not just procurement calculations but also the accuracy of the models relating to climate change, income distribution, benefits claims, and farming subsidies. Quite honestly I have never heard the like of it before in my life!

I would like to hear what scenario planning and risk assessment has been completed on the initiative? What will happen if one, never mind the majority, of the key models prove to be defective?  What will happen if key policies have been launched and introduced on the back of flawed models? How much will all this cost?

Nearer to home, which key procurement models will be tested and what will happen if they are considered weak?  While politically a U-turn can be painful, the might of the Remedies Directive and the Freedom of Information Act may lead the government walking into a potential Procurement Litigation Agency scenario having to address an abundance of FoI requests and procurement challenges.  What will be the impact beyond central government - could the localism powers be extended to enable a referendum to be called for a review of all procurement models and decisions in an area. We are only too familiar with a war having been started on the back of flawed assumptions and 'reported facts' but that doesn't mean we can turn back the clock.

Of course the need for the review may be considered politically expedient, however, what I would advocate instead is a U-turn. Instead of a 'rear-view mirror' analysis, review the effectiveness of  scrutiny, gateway reviews, risk management and quality assurance - particularly for procurement decisions (this blog has highlighted many examples where that has proved ineffective). Such a review of the protection mechanisms will help in the avoidance of future fiascos. That will encourage honesty while the current review can only be expected to encourage defensiveness and a hiding in the sahdows, particularly given the backdrop that mandarins we now be penalised for not implementing government policy.


 

Sustainable procurement risk

Tell me what would you do if you read this statement in an ITT:

The [organisation] is committed to sustainable procurement and would wish to see tenderers adopt a positive environmental approach.  Information and guidance about how to pursue a more sustainable future is available from [central government portal]1

You could

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

Political ownership of risk management and procurement scrutiny

If there has been one mantra since the coalition came to power regarding public procurement, it has been that transparency in public procurement is paramount - hold on to that context for a few minutes.

Yesterday I discussed the procurement of the NHS IT system and argued that if we really wanted to learn from the experience we had to move beyond criticising the procurement but instead probe what went wrong with the application of Gateway Reviews (http://drgordy.blogspot.com/2011/12/nhs-it-system-procurement-fiasco-or.html).  Now we find that the risks of failure were concealed from MPs - this echoes the defence of David Steele when he was asked to account for the procurement problems with the building of the Scottish Parliament, he said the civil servants concealed the true state of the project from politicians.  Politicians clearly have to be in a stronger position to scrutinise and, I would argue, be a part of Gateway Reviews or see those reports.  Elected members need to be fully appraised of risk assessments if scrutiny is to be effective. Is there a potential script being written here for a Christmas Special of 'Yes Minister'?


Furthermore, today we've learnt that the NHS will not respond to a FoI request on the fiasco. How does that fit with the transparency mantra? What's changed?


Well, allegedly the FoI request cannot be acceded to in case the supplier who has been unable to deliver to contract (for example, 3,128 defects) suffers a fall in their share price.  Correct me if I'm wrong, but should share price not reflect company strength and long-term sustainability?  Do public procurement specialists not consider financial stability when awarding contracts? Is it not the responsibility of the supplier to argue when bidding the grounds for non-disclosure of commercially sensitive aspects of their bid, therefore did the supplier argue when bidding that in the event of such a catastrophic failure to deliver they would prefer no disclosure would take place regardless of the UK public interest in achieving value for money?  How on earth can we collect lessons learnt, in line with the UK public sector best practice, if secrecy prevails even when a procurement disaster has struck? If I was a public procurement practitioner and was carrying out a supplier appraisal on the supplier, would the NHS suggest all is well and let me waste more money with the supplier?




Background reading
Kennedy, D., Pitel, L., and Hohmann, I. (2011) 'Dead wrong, the software that NHS says it just cant't discuss', The Times, 9 December 2011, pp.19-20.
Pitel, L., Smyth, C. and Kennedy, D. (2011) 'American 'cowboys' blamed for NHS fiasco', The Times, 9 December 2011, p. 1 and p.19.