Manchester City Council (MCC) increased local engagement and participation in its contracts by reducing the size of contracts and improving visibility of tender opportunities.
Speaking to delegates at Procurex National, Paul Murphy, deputy head of corporate procurement at Manchester City Council, explained how the council implemented a policy that would break down barriers and enable SMEs to participate more in tenders.
“We’re about price, quality and social value. We need to do things differently than it’s been done traditionally… to innovate,” Murphy said.
MCC embarked on a policy to engage with more SMEs in 2014-15, at the same time aiming to reduce £600m of procurement spending and provide opportunities to increase social value in contracts.
Contracts were cut into more manageable “chunks” for smaller suppliers, said Murphy. While previous electricity contracts were supplied by one large sole supplier, MCC wanted to “open it up” and allow opportunities for multiple local suppliers. A multi-supplier framework was created, and divided into four lots, resulting in the highest participation figures yet, according to Murphy.
The council engaged the electricity market before the tender was released in order to discuss how to do things differently and ensure suppliers understood what was required.
Early engagement has become a key part of the procurement process in Manchester with Q&A sessions and open days held regularly for suppliers and public commissioners.
The Chest portal, an e-portal for advertising public tenders, was introduced in order to make tenders more accessible and visible to suppliers. The documentation and tender process was also simplified, and pre-qualification requirements were removed, for contracts with a value up to £100,000, to give access to SMEs.
“We’ve got strong thoughts on social value,” said Murphy, adding that the weighting put on social value in contracts has increased to 20%, and a recent contract included 30% social value.
Since the transformation began MCC has boosted the local economy by increasing spending within the city by approximately 20% between 2008-9 and 2017-18. Spending on contracts with SMEs also increased by 15% between 2014-15 and 2017-18.
Murphy said: “Manchester companies are winning the work, and we’ve got a bigger spread of SMEs within our top 300 suppliers. We increased our spend with SMEs within Manchester to £265m, which is significant and has a knock-on effect through social value. We’ve also found two thirds of suppliers are actively providing support to voluntary and community sector organisations.”
Manchester’s corporate public procurement department has been driving cost saving and pioneering innovative strategies, and the Federation of Small Businesses has encouraged Scotland to adopt similar approaches to improve co-operation between public bodies and local suppliers.