20 May 2011 | Angeline Albert
Buyers should focus more on local purchasing to improve
communities, a policy researcher has said ahead of next month’s Public Procurement Show.
Matthew Jackson, head of research at independent think tank Centre for Local Economic Strategies (CLES), believes buyers
can do more to drive value in local areas and will explain why at the event on
14-15 June at London’s ExCel venue.
He believes purchasing professionals can balance the need to make efficiencies
and cost savings with buying locally.
The CLES, a policy research firm focused on local economic
development, conducted studies of Manchester City Council’s annual £357 million
procurement spend to find out how much is spent locally. It discovered 51 per
cent is spent on organisations in the city. The CLES’s survey of top suppliers
to the council revealed 25p in every £1 received by providers was re-spent in
the greater Manchester economy. This compares positively to studies undertaken
by CLES in Swindon (16p in every £1) and West Lothian (18p in every £1).
Jackson said purchasing departments could have better
relationships with other departments at their local authority and with
suppliers, to drive local economic, social and environmental benefits. He
recommends that councils set buying teams clear targets to encourage efforts to
positively impact local communities and work with supply chains to develop and
drive the policy. He has helped establish a networking group between buyers and
local suppliers in Manchester and believes there must be “more engagement
between local buyers and local suppliers right across the country”.
In terms of the coalition government’s welfare issues,
Jackson believes procurement could be part of the solution with support for
local labour and apprenticeships through the supply chain helping foster
positive change in communities. He said this is something the construction
sector does very well. He accepted that EU procurement law can be a barrier to
local purchasing but said suppliers could tender their bid response to include
efforts to help local communities, by for example offering apprenticeships.
Jackson said buyers’ knowledge of local businesses in the
area and what they can offer should be developed. And pointed out that
collaborative purchasing between one or more organisations can shut out local
suppliers who may not have the capacity or skill set to handle large volumes of
work. Splitting contracts up into manageable chunks may be one solution.
☛ Jackson will be speaking at The Public Procurement Show,
where Supply Management is an official media
partner, in London on 14-15 June.