Head of School leads discussion on improving Welsh Public Procurement at Institute for Welsh Affairs Conference

Professor Dermot Cahill, Head of Bangor Law School, was invited to lead a discussion at the Institute for Welsh Affairs Conference on improving Welsh Public Procurement, alongside Minister for Finance and Leader of the House, Jane Hutt AM, in Cardiff on 5th November 2012.

Professor Cahill critiqued John McClelland’s report on how to maximise the Welsh pound in public procurement in Wales at the IWA. The main finding of John McClelland’s very well written report is that, although the Welsh Government has developed excellent policies in public procurement, unfortunately, the Welsh Government procurement policies are not being fully accepted and implemented by a significant minority of public sector organisations in Wales. McClelland was firmly of the view that, while the policies were sound, their implementation in every day operations was not at a satisfactory level. The report recommended that a duty to adopt Welsh Government procurement policies should be made a legal requirement. Professor Cahill also discussed McClelland’s requirement that the Chief Executives of all public bodies in Wales should be required to indicate on an annual basis the extent to which they have followed Welsh Government policies, and an explanation of why not, where they have not followed such policies. Professor Cahill approved of this recommendation, and said that it would bring greater accountability and transparency and allow organisations that are not following Welsh Government policies to be readily identified, so that corrective action could be taken.

Particularly interesting in the McClelland Report is McClelland’s findings that a significant number of Welsh local government authorities (15 out of 22) have either a “weak” or a “very weak” staff to procurement spend ratio. The significance of this is that, in McClelland’s view, those local authorities that devote fewer human resources to the procurement function, spent less money in Wales than authorities which devoted more human assets to the procurement function. The nine worst performing local government authorities, in this respect, spent £820m per annum, a staggering amount of money, and yet, a significant proportion of this is not being spent in Wales. Out of these nine, four local authorities apparently spent 15% or less of their procurement spend in their local area, and this gives significant cause for concern, as there seems to be a correlation between weak procurement and capability, and low spend within Wales.

John McClelland referenced Professor Cahill’s co-authored Barriers to Procurement Opportunity Report in his research, stating that “it provides not only a completely comprehensive analysis of the issues, but also, its recommendations constitute a solid action plan to address the problems of access to public sector business, and the conduct of pre-qualification questionnaires and tenders”. McClelland was further of the view that should the Barriers to Procurement Opportunity Report be implemented fully, then virtually all of the concerns raised with him by suppliers while he conducted the research for the writing of his report could be addressed. 

Professor Cahill also critiqued John McClelland’s call for a mandatory duty to be imposed on all funded bodies to adopt Welsh Government procurement policies, and that this should include the delivering of wider economic, social and environmental benefits. This is a significant recommendation made by McClelland, and in Professor Cahill’s view, would change the vision for public procurement, and would have a dramatic impact on the society in Wales. 

Professor Cahill also referred approvingly to McClelland’s recommendation that there should be a linking between economic development and supplier support, and that this should be vigorously pursued. 

McClelland made interesting recommendations in the field of e-procurement, recommending that while a major upgrading of national e-procurement platforms is badly needed in Wales, he recommended that there should be significant investment in new platforms, only if two criteria could be satisfied, namely first that new platforms should have the capability to generate accurate management information, and second, public sector should bodies commit to using these new platforms. This is significant because there is significant evidence that existing platforms are not being sufficiently used by the public sector in Wales, and this raises a grave question about transparency of procurement opportunities, as well as the value in making significant investment in new platforms.

Finally, McClelland’s report turns to the role of Value Wales – a division of the Welsh Government which is charged with modernising procurement in Wales. McClelland was fulsome in his report on Value Wales, saying that its policy work has been pioneering, and often cutting edge, and that the policies that Value Wales has developed were appropriate for addressing the needs of Wales. However, there has also been insufficient investment by the Welsh Government in funding Value Wales to oversee policy implementation, and as a result, adoption and usage of Value Wales procurement policies, by the public sector in Wales, remains a major issue. To illustrate this point, Professor Cahill critiqued McClelland’s findings which demonstrated that there are several Value Wales policies which are being pursued by only a minority of Welsh public sector bodies. In conclusion, Professor Cahill agreed with McClelland’s conclusion, that whilst Wales has developed excellent procurement policies, implementation is the Achilles’ Heel. McClelland recommended that for implementation oversight to work, it needs crucial investment, and furthermore, that the implementation imperative is neither understood nor often accepted by some stakeholders, and as a result, intervention action by way of mandatory rules is now required. 

Publication date: 13 December 2012