Single party councils miss £2.6 billion procurement savings

Paul Snell is managing editor at Supply Management
5 October 2015

Local authorities in England controlled by a single political party achieve less value for money on contracts than their counterparts.

A study published by the Electoral Reform Society (ERS) found councils with “weak electoral accountability” are missing out on £2.6 billion procurement savings and are at 50 per cent greater risk of corruption. This was in part attributed to lower levels of scrutiny of deals that such authorities provide.

“The £2.6 billion potential wastage is a damning indictment of an electoral system that gives huge artificial majorities to parties and undermines scrutiny. This kind of waste would be unjustifiable at the best of times. But during a period of austerity it is simply astonishing,” the ERS said.

The cost of one-party councils examined data from 132,000 public contracts between 2009 and 2013. It looked at authorities where the same party had been in control for 10 years or more, and those where at least 10 per cent of seats were uncontested, comparing them with competitively elected councils.

The report, written by University of Cambridge research associate Mihály Fazekas, found councils with uncontested seats achieved average savings of 3.4 per cent, compared with 4.4 per cent negotiated by competitive councils. One-party authorities saved 2.1 per cent on average, against 6.2 per cent by competitive councils in the sample.

Extrapolating these missed savings against the estimated £45 billion local government procurement budget for England amounts to £2.6 billion in lost value.

The study also identified a number of ‘red flags’ where contracts could have been steered toward a favoured bidder to make up its corruption risk index (CRI). These included tenders where only a single bid was received, short deadlines for submitting or evaluating tenders, and tenders not openly advertised.

The average CRI score for councils with uncontested seats was “substantially higher”, with a 50 per cent greater threat of corruption than competitive authorities. Single party dominated authorities also had a 51 per cent higher risk of corruption.

Up to-£40k dependent on experience
GX2 Technology Group
GBP30000 - GBP50000 per annum + pension + bonus
Bramwith Consulting
CIPS Knowledge
Find out more with CIPS Knowledge:
  • best practice insights
  • guidance
  • tools and templates