Commercial excellence is to be the ‘new normal’ in public sector procurement, Sir Jeremy Heywood, Cabinet Secretary and Head of the Civil Service, has said in a blog on the civil service website.
Criticism of civil service procurement and contract management has been coming thick and fast for a number of years, and it might seem brave of so senior a figure to stick his head above the parapet with claims about measureable improvements that are targeting that elusive goal of excellence. Most construction leaders these days would settle for being able to show continuous improvement and have for long regarded ‘excellence’ as merely corporate brochure-speak.
But there is a new confidence in recent government and civil service statements about the effect of reforms that have been put in place and some whose benefits are filtering through. Sir Jeremy pointed to a Department for Work and Pensions success in securing heads of terms for a commercial deal on rents and facilities management on its estate that will deliver savings of £180 million a year for the next decade.
‘This was a complex and highly technical piece of commercial work, covering some 900 buildings across the country,’ he says.
He is honest enough to admit that all is not yet rosy in the garden, see the £100 million Magnox clean-up story in News for an example, adding: ‘Although there are plenty of examples of excellent work, Whitehall still doesn’t have either the capacity or consistent capability to deliver excellence at the scale we need.’
A government Chief Commercial Officer from outside the civil service has been appointed to spearhead the reforms, Gareth Rhys Williams who was previously Chief Executive of workplace services supplier PHS Group. Strengthening the capability of the 4,000 civil servants working in the Commercial Function across central government is his main task. He is to create ‘a new, world-class, Government Commercial Organisation (GCO)’ which will directly employ the most senior 400 staff within the function.
After less than a year the new set up is taking clear shape. The GCO’s role is to create a larger pool of commercial talent within departments, focusing on departmental objectives and sharing best practice for everyone’s benefit. ‘For the first time,’ says Sir Jeremy, ‘we are building a complete picture of commercial capability across government and defining the long-term shape of commercial functions within departments.’
The role of contract managers in achieving good commercial outcomes is recognised and it is planned to provide professional standards, learning and development support for them, along with formal accreditation, starting with those managing the contracts of highest value or greatest risk.
The best procurement professionals have been deployed to high-priority areas. Other measures include shaking up the recruitment and pay of senior commercial specialists, and focusing on retaining staff with new salary arrangements.
So progress is being made, it seems. But the evidence has not yet stacked up conclusively in support of the likely success of Sir Jeremy’s plans. As you can read in News, the Institute for Government (IfG) has warned that although the plans are sound, they are vulnerable to being rolled back. Short term priorities have a habit of diverting ministerial and civil service attention and the IfG warns that the next three years will be crucial in preventing the current reform drive from withering away. That would be a reversion to the ‘old normal’.
Nick Barrett
Editor