A Green Paper for the first UK government industrial strategy for many years has been released for consultation, but receiving a lukewarm response from industry generally. Some criticism was along the lines of there is nothing new in it and it is just a discussion paper.
Green Papers are discussion papers anyway, but the significance of this one might be in the fact that it is being spearheaded by the Prime Minister herself. Many of its features will affect construction and its clients in important ways.
It promises that a new, strategic approach will be taken to the procurement of the public sector’s £268 billion a year spending. Procurement reforms are to ensure that UK supply chains are strengthened, competition is to be increased to help smaller companies, and there will be investment in innovation and skills.
UK supply chains will be helped to be in the strongest possible position to compete for contracts on the basis of best value for the taxpayer. The public sector is to use its demand to drive innovation from industry, stimulating and accelerating the development of new and transformational products and services.
The Green Paper promises that government will ensure all major government suppliers sign up to the Prompt Payment Code, promising to pay suppliers, promptly and fairly.
Supply chains will come under greater central government scrutiny than ever before, the paper promises. UK central government has never had detailed visibility of the supply chains of its key suppliers, so it has had limited knowledge of the impact of its procurement decisions on UK supply chains.
Improving procurement practices is to be fostered by using a ‘balanced scorecard’ approach, which takes account of social and economic factors. This approach, developed by the Cabinet Office, is to be used across all major construction, infrastructure and capital investment projects over £10 million, including those in the National Infrastructure and Construction Pipeline. Good practice adopted on Crossrail is cited as an example.
There will be pre-procurement market engagement on potential innovative solutions, using outcome based specifications, holding regular innovation reviews during contracts, and ensuring intellectual property is held by the party best placed to exploit it – which might be the supplier.
Unnecessary bureaucracy in central government’s procurement process is to be cut. For example, the Crown Commercial Service is simplifying its tender documents, contractual terms and conditions, and removing the requirement for suppliers to submit the same information every time they apply for a tender.
‘Burdensome’ pre-qualification questionnaires will be scrapped for lower value contracts and a standardised approach introduced for higher value procurements. Payment of undisputed invoices is to be made within 30 days.
The government is establishing a new Infrastructure Exports Leadership Forum (IELF) to promote a ‘Team UK’ approach, allowing the government and industry to work together to undertake pre-competitive engagement in new markets, with the first Forum to be convened early in 2017.
There might not be a lot that is new in this Green Paper but at the very least it shows that many of the industry’s procurement related concerns have come to the forefront in the thinking of government at the highest level. That is probably a recent first. The White Paper that results from consultation is awaited with keen interest.
Nick Barrett
Editor