23 January 2020
‘More than managing’ sets out a range of suggestions to build on the Cabinet Office’s ‘Outsourcing Playbook’ - launched at the CBI by the Rt Hon Oliver Dowden MP CBE last year.
The new report outlines a series of measures both the public and private sectors can take to improve the management of contracts, which are critical to the public purse and essential for the delivery of high-quality public services and infrastructure.
Introducing the report, Matthew Fell, CBI Chief UK Policy Director, said:
“At any one time, central government departments are managing tens of thousands of contracts, varying from large infrastructure projects to frontline public services. Getting commercial practices right to deliver better value for taxpayers is simply critical.”
“While government has taken steps to increase its effectiveness in managing public service contracts and projects, supplier feedback as well as National Audit Office analysis shows that more can be done. Firms are ready and able to help improve delivery.”
“A key part of this will be making sure lessons are learned from past project failures and increasing accountability on both sides so that action can be taken where delivery falls below expectations.
“The Outsourcing Playbook has been widely welcomed by industry, and it’s now time to accelerate progress and support better collaboration between business and the public sector not just in procurement, but throughout the entire commissioning cycle.”
“Implementing the recommendations set out in our report – from reducing churn among senior managers of public contracts to sharing best practice between central and local government commissioners – will help instil a culture of continuous improvement that will have a positive effect on public finances, and ultimately, people’s lives.”
Recommendations from the CBI’s report on improving public contract management include:
*Commissioners should use early dialogue with suppliers to inform the procurement route and contractual terms including those related to performance specification, risk allocation and, where relevant, the approach to intellectual property.
*Public bodies should select an appropriate and proportionate number of KPIs which are tailored to the size and complexity of the contract, and that encourage both parties to focus on outcomes instead of process.
*Commissioners should ensure that the KPIs selected are clearly defined, can be measured and ‘have teeth’ so that, where appropriate, under-performance can be held to account. KPIs should be accompanied by a statement of the buyer’s responsibilities.
*Contracts should be accompanied by a contract manual summarising the key responsibilities and deliverables for both buyer and supplier.
*Public sector commissioners should create more multi-disciplinary commercial teams involved in the end-to-end process.
*Public bodies should invest to improve document management systems and put in place structures which support the sharing of data and documents with suppliers.
*The Contract Management Professional Standards should be updated to state that contract managers should always, rather than ideally, be involved from the outset of the procurement process.
*Public sector contracts should contain clear provisions for resolving disputes beyond just legal remedies. Particular focus should be given to the day-to-day management of disagreements so that issues can be identified, recorded and nipped in the bud quickly.
*The Cabinet Office should form a Local Government Commercial Taskforce with HM Treasury, the Ministry of Housing. Communities & Local Government (MHCLG) and the Local Government Association (LGA). This group will be charged with extending commercial training, wherever possible to local government commissioners, and encouraging the take-up of the commercial operating standards.
*The civil service should introduce more performance-related pay incentivising commercial staff to ensure contracts successfully deliver improved contract outcomes.