Labour MP Hillier attacks public procurement processes

Gurjit Degun
5 December 2013

A former Home Office minister has called for shorter procurement processes to help small businesses bid for public sector contracts.

Labour MP Meg Hillier was speaking in the House of Commons after securing a debate on government contracts. She told the House there needed to be a “serious step change in how contracts are drawn up”.

Hillier said that when a contract includes 150 key performance indicators, it suggests a “serious lack of critical focus”.

She also questioned the length of procurement processes. “One supplier tells me that in the US, Canada, Sweden and New Zealand, procurement of the same product has typically taken seven to 12 weeks compared with two-and-a-half years for a Ministry of Justice contract that is still not concluded,” Hillier said.

“What is being done to improve how contracts are drawn up? Many small businesses have highlighted the complexity of contracts and the frequent changes by commissioners as off-putting.

“Why is government still demanding that intellectual property (IP) be handed over to government? Does the Cabinet Office have any guidance for departments about that? Has it seriously addressed the issue? It can be a deal-breaker for emerging tech businesses, whose capital is often their IP.

“What is the government doing to break down government contracts into smaller contracts?”

Nick Hurd, Cabinet Office minister for civil society, explained the government has cut the length of the average procurement process by 40 per cent, “which makes the UK, we think, faster than any of our European counterparts”.

“Part of the process is improving our commercial capability and confidence at the heart of the civil service, so 1,800 officials have already been trained in procurement and 150 leaders have been through the Major Projects Leadership Academy in Oxford,” he said.

“We need to go much further and get smarter at managing performance. For the first time, the government have allowed past performance to be taken into account when bids for new work are evaluated. It is astonishing that that has not happened before.”

Hurd also said the next step in terms of contract complexity involves the government introducing a model contract for services, “which sets out best-practice contracting approaches and includes a streamlined performance management regime”.

He added IP issues will be dealt with on a case-by-case basis. “In the new model service contract, ownership of previously existing intellectual property rights will stay with the author,” said Hurd. “If the government pay for new IP rights to be created, however, in some circumstances it will be appropriate to retain ownership.”

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