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Day1 sess1&2
 

Day1 sess1&2

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  • Procurex National 8 March 2011 Reshaping Public Sector Procurement

Day1 sess1&2 Day1 sess1&2 Presentation Transcript

  • SESSION 1 DEFINING THE LANSCAPE Day 1 – Tuesday 8 March
  • CHAIR’S OPENING REMARKS Grahame Steed, Managing Editor, Government Opportunities (GO)
  • SESSION 1 DEFINING THE LANSCAPE Day 1 – Tuesday 8 March
  • FIXING THE PUBLIC FINANCES Bill Hill, Associate Partner, Deloitte
  • SESSION 1 DEFINING THE LANSCAPE Day 1 – Tuesday 8 March
  • Reshaping public sector procurement - the practitioner’s view David Thomas Commercial Director HM Revenue and Customs [email_address] 0161 827 0261
  • Overview of current position
    • “ The stage”
    • “ The cast”
    • “ The script”
    Procurex National | 8 March 2011 |
  • “ The Stage”
    • Efficiency Reform Group
    • Central Government Departments
    • Wider public sector
    • OGC
    • Buying Solutions
    Procurex National | 8 March 2011 |
  • “ The Cast”
    • Francis Maude
    • Ian Watmore
    • John Collington
    • Adrian Kamellard
    • Katharine Davidson
    • PEB
    Procurex National | 8 March 2011 |
  • “ The Script”
    • Austerity
    • Tight and loose
    • Renegotiate contracts
    • Aggregation
    • Centralise commodity procurement
    • ‘ De chunk’ IT
    • SME development
    • Transparency
    • Crown Commercial representatives
    Procurex National | 8 March 2011 |
  • What are the practical challenges that arise?
    • Roles and responsibilities
    • Separation of central government from wider public sector
    • Transformation of Buying Solutions
    • Balancing vfm and SME development
    Procurex National | 8 March 2011 |
  • Roles and responsibilities
    • Centralising commodity procurement impacts Department organisations
    • Sourcing ownership changes
    • Contract management roles change
    • Departmental commercial teams retain a different but important role.
    Procurex National | 8 March 2011 |
  • Contract Management – a new model Procurex National | 8 March 2011 | Central Government leadership Joint Department and Central Government responsibility Departmental role
  • Transformation of Buying Solutions
    • There is a problem – FACT
    • February strategic review
      • Supplier views sought
      • Customer views sought
      • Employee consultation
    • Proposed strategy declared in March
    • One thing is certain – this transformation will take time to work fully
    Procurex National | 8 March 2011 |
  • Central Government and the wider Public Sector
    • Tight and loose is declared policy
    • MCO changes are for Central Government only now
    • There are practical implications from this:
      • Is it a straight line or wavy?
      • Two market approaches?
      • Separate current contracts
      • BS – are they two teams?
    Procurex National | 8 March 2011 |
  • Value for money and the development of SMEs
    • Can all policies work in absolute harmony?
    • Fully understand and accept Government policy but again there are potential issues for buyers to work through:
      • Some markets have few SMEs
      • SMEs may have below threshold financial capabilities
      • Resistance to change from major suppliers
    Procurex National | 8 March 2011 |
  • Conclusion
    • Public sector procurement is changing
    • Buyers have to recognise the changes and adapt
    • Change creates issues and it is our responsibility to manage them
    Procurex National | 8 March 2011 |
  • Thank you Any questions?
  • SESSION 1 DEFINING THE LANSCAPE Day 1 – Tuesday 8 March
  • David Clark Director General SOLACE Presentation to Procurex National 2011 – The Procurement Exhibition Birmingham National Exhibition Centre, 8-9 March 2011
    • Permanent hit to public finances from financial crisis estimated at £86 billion a year (in today’s terms)
    • Response is a £98 billion fiscal tightening by 2015–16, comprising a £24 billion tax rise and a £74 billion spending cut (in today’s terms)
      • OBR estimates 60% chance of hitting fiscal mandate on current policies
    • Overall post crisis tax and benefit reforms regressive across most of the income distribution.
      • cuts to welfare payments for working-age individuals
    • Four years from next April will be the tightest sustained squeeze to public service spending since April 1976 to March 1980
      • total DELs cut by 11% in real terms
      • overseas aid budget increased sharply
      • in England: NHS and schools relatively protected; largest cuts to: Communities and Local Government, DEFRA and BIS
    © Institute for Fiscal Studies Data: Institute for Fiscal Studies
  • Impact of cuts to spending on public services
    • Total spending on public services to be cut in real terms for six years
      • since WW2 cuts have only been achieved for two consecutive years
      • deepest sustained cuts since April 1975 to March 1980
    • Central government spending on public services (DELs)
      • to be cut as a share of national income back to the late 1990s levels
      • in real terms spending in 2014–15 to be 11.2% lower than in 2010–11 or 13% below the level Labour planned for 2010–11
    © Institute for Fiscal Studies Data: Institute for Fiscal Studies
  • ‘ Winners’ © Institute for Fiscal Studies Data: Institute for Fiscal Studies Note: Figures show real change in total (resource + capital) DEL
  • ‘ Losers’ © Institute for Fiscal Studies Data: Institute for Fiscal Studies Note: Figures show real change in total (resource + capital) DEL
  • Record breakers?
      • total spending: tightest since World War II
      • spending on public services: tightest since April 1975 to March 1980
      • NHS: tightest since April 1951 to March 1956
    © Institute for Fiscal Studies Data: Institute for Fiscal Studies
  • Issues for local government Budgets A time limited council tax freeze; followed by below inflation rises? A pay freeze for public sector workers, not necessarily in local government, but practically it will happen
  • Three Lines of attack: People Plant and Capital Contracts Locally?
  • Public and private sectors working together to deliver services “ Cuts will fuel a ‘surge’ in public sector outsourcing ” National Outsourcing Association
  • Outsource What? BPO - Facilities Management - Fleet Management Variously defined back office activities Domiciliary and Elderly care
  • Models Straight outsource Joint venture, some hubbing but more likely to be looking at place based alternatives. Talk of mutuals, but little understanding as to what this might mean
  • Third Sector Risk Management relatively underdeveloped 76% dependant on local government or national government money
  • Some services lend themselves to community involvement Centre for learning difficulties in Sussex Volunteer dust crews, street sweepers and physics teachers are harder to come by
  • More likely that some services will disappear or become only available to those that can pay Borough Engineer Student Grants Officer
  • A smaller less supporting state Greater use of contractors Different use of third sector (where there will undoubtedly be consolidation) Driven by new combines of authorities    
  • Q&A SESSION
  • SESSION 2 DELIVERING SAVINGS – LIVE DEBATE Day 1 – Tuesday 8 March
  • DISCUSSION ON HOW TO FACE THE CHALLENGE OF MEETING THE EFFICIENCY TARGETS Grahame Steed, Managing Editor, Government Opportunities (GO) Panellists: Ken Cole , Commercial and Procurement Advisor, Capital Ambition Nigel Kletz , Assistant Director, Corporate Procurement Services, Birmingham City Council David Loseby , Ex-Chief Procurement Officer and Head of SRM,Westminster City Council Eddie Regan , Senior PASS Consultant, BiP Solutions Jack Salter , Head of Commercial Policy Team, Department for Education
  • SESSION 2 DELIVERING SAVINGS Day 1 – Tuesday 8 March