'Fear of failure' harming public procurement

12 November 2007
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12 November 2007 | Paul Snell

Public sector buyers are damaging value for money in procurement because they are "too timid", according to a group of MPs.

A study into public procurement by the Trade and Industry select committee said many buyers in the public sector are too afraid of failure to try new approaches.

While it recognised buyers should avoid risky projects that may fail, it was critical of existing market knowledge. "Those buying goods and services are either insufficiently well acquainted with the sector concerned to know or understand what options are, or could become, available, or are too afraid of failure to try anything new even if it would provide better lifetime costs or additional benefits," the report added.

The committee recommended the OGC use its procurement capability reviews to highlight best practice to improve government buying.

The report also expressed concern about the improvement rate of procurement skills in the sector. It said: "The target which we endorse - that the majority of public sector purchasers be professionally qualified - is unlikely to be fulfilled for a very long time, until there are enough high quality people spread throughout the public sector."

There were also recommendations to improve access to government contracts for SMEs. "SMEs face even greater difficulties in securing public contracts than larger businesses and these difficulties may increase as a result of the government's efficiency agenda," it said.

"SMEs need an obvious champion within government. At present, it is not clear which department has responsibility for protecting their interests in relation to public procurement."



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