Access for SMEs and the extent of government e-procurement helped New Zealand attain the top spot ©Getty Images
Access for SMEs and the extent of government e-procurement helped New Zealand attain the top spot ©Getty Images

New Zealand's lessons for government procurement

10 May 2019

New Zealand’s civil service policies are ‘efficient, competitive, fair and value for money’, according to a report released by Oxford University’s Blavatnik School of Government, which gave it first place in its rankingof government procurement effectiveness.

It is the first time procurement has been included in the International Civil Service Effectiveness (InCiSE) Index, a global benchmark of government performance.

The extent of e-procurement functions and access for SMEs contributed to New Zealand making the top spot and suggests the country “has positive lessons to share with other countries,” the report said.

The procurement indicator scores for the top three countries – New Zealand, Denmark and the UK – were significantly ahead of the next highest countries. Among the top five, Israel and the UK achieved the maximum score for policies “in place to help small and medium-sized enterprises participate in central government procurement”.

Denmark had a maximum score for the role of its central purchasing body, and the Republic of Korea’s highest score was for e-procurement within government. 

Countries were ranked according to their e-procurement function, the role of the central purchasing body, access for SMEs, admin effectiveness, transparency and integrity, and used data from the Organisation for Economic Co-operation and Development and Opentender.

The index ranks civil service effectiveness, with 38 countries selected based on the level of data available. Despite ranking highest in terms of civil service effectiveness, the UK’s third place for procurement comes amid calls for improvements to government purchasing practices.

Roughly a third of all UK public service expenditure goes on outsourcing, equalling £284bn per year, according to a report released by think tank Reform. The report, Please Procure Responsibly, warns of “several key areas where weak or underperforming elements in the commissioning cycle have led to failings in the procurement of public services”.

Its guidance builds on that outlined in the Cabinet Office’s recent Outsourcing Playbook, and identifies shortcomings in procurement that are yet to be resolved. While the Playbook outlines a process for make- or-buy decision-making, the language used assumes the service will be outsourced, says the Reform report.

A full review of public procurement services and an independent review of the regulatory landscape will highlight where the system is broken, it says.

“Public procurement can resolve many of the issues it currently has by ensuring that transparency is installed into the heart of the system. But doing so requires a better focus on data, risk, accountability, contracting and skills, to enable commissioners to be more transparent and more effective in their commissioning,” concludes the Reform report.

Speaking at the Procurex conference in April, Mark Roberts, commercial continuous improvement director, said following Playbook’s release, the government was working to “help us shape our policy and to help suppliers to better understand how and what the government is trying to do”.

Procurement Top 5

  1. New Zealand 
  2. Denmark 
  3. UK 
  4. Republic of Korea 
  5. Israel 
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