01 March 2001
The OGC hopes that its new review scheme will bring a halt to the costly blunders that have marred some big projects. David Arminas reports
The gloves are off as the government's premier procurement agency unveils Gateway reviews, its main weapon to tackle costly overruns for large projects in an effort to deliver £1 billion savings by March 2003.
The shape of this initiative should come as no surprise to senior government purchasing managers and directors.
Since the Office of Government Commerce (OGC) was set up in April 2000, Peter Gershon, its chief executive, has been promising to instill a healthy dose of private-sector nous into central government procurement.
As long ago as last May, the government made it clear that a more rigorous approach is coming for large project procurement. Its report, Successful IT - Modernising Government in Action, was the first to spell out a more proactive role for the OGC in its relationship with all government departments and their agencies.
However, does a more proactive role through Gateway spell out a danger for the OGC and its relationship with purchasing heads? Departments and agencies might consider the reviews as, at the very least, an interference in their work or, at worst, an on-the-job examination of their skills.
This needn't be the case, although admittedly reviews will take place at key-decision making points in a project's life and be carried out by a group of experienced staff independent of the project team. The OGC is now building a database in conjunction with departments to identify such people from across the public sector.
But Gershon has stressed that review teams are there to help rather than judge. While only five reviews, lasting up to five days each, are planned per project, interim reviews can be arranged if desired by project leaders.
The Gateway review launch comes within days of an announcement that the influential public accounts committee will investigate yet another troubled IT contract. Siemens Business Services and the Home Office will face questions over why the Immigration and Nationality Directorate's casework application programme has been scrapped after three years of work. The system to speed up refugee and asylum applications cost at least £110 million.
Other examples include a Post Office and Department of Social Security swipe card ditched after £1 billion had been spent on it and the £12.6 million spent by the Passport Agency to correct an IT system that delayed rather than sped up passport applications.
A recent report by consultants Kable suggests that a massive £10 billion will be spent on IT by government next year. Never have the challenges been so great or the stakes so high for government purchasers.
Gershon has made no bones about who the reviews are for: "senior management in government departments [need] to get a much better control of their large complex and novel acquisition projects". Pointedly, reviews are "a powerful technique to help project sponsors of construction, property projects and senior responsible owners of information technology information projects discharge their responsibilities".
In effect, reviews will increase the accountability of those in charge. Fewer excuses for failure will be accepted.
But does the OGC have any teeth to enforce adherence to review recommendations? In a word, no. But then from its inception, coercion has been out of the question.
Andrew Smith, chief secretary to the Treasury and chairman of the OGC's supervisory body, told SM: "Certainly, if the OGC advises me that there is a project which should be complying with the gateway process and isn't, or has not taken remedial action, a report will come to me and I won't hesitate to have the minister in and have a fraternal discussion with them."
If senior department officials and ministers realise they will be held more accountable, their acceptance is much more likely, according to one teacher of purchasing strategies to civil service personnel. Without that buy-in, it will be an uphill struggle for the success of Gateway reviews.
Only time will tell if the reviews work. A project's life can be up to four years, according to the OGC. If reviews are taken in the spirit in which they are meant, then there should be ample time to get it right.