The procurement bill: what does it mean for charities?

On 11 May the government published the Procurement Bill. The bill aims to improve regulation of public procurement – the process central and local government go through to source and purchase goods, works or services.

Procurement is one part of a wider commissioning process that many charities engage with to deliver support to people across a range of areas from criminal justice to social care. In 2018/19, charities delivered £15.8 billion worth of public services on behalf of the government – a full quarter of the voluntary sector’s income.

The bill could have tangible implications for charities that currently deliver public services, as well as those that may wish to in the future.

Last year we worked with members of the Civil Society Group and our members to influence the procurement green paper. Using this valuable insight, we submitted a response including the following.

• Providing public services for people is very different to, for example, buying office supplies. The process for organising and sourcing them shouldn’t be the same.
• The implementation of the rules is often more of an issue than the rules themselves. The existing system allows for much more flexibility than is often used.
• Proportionality needs to be a core principle to prevent overly burdensome processes.
• A focus on purpose and outcome over process is vital to improve service provision. Procurement is just one part of the process to design and deliver a service but often dominates.
• Approaches to account for social value need to be improved so it works for charities, including recognition of the inherent social value charities bring.
• Commissioning and procurement processes need to enable partnership and collaboration.
• We need greater weighting to quality rather than price, alongside an increase in funding to cover the true costs of delivery.

The bill doesn’t make drastic changes to procurement rules. But there are aspects to welcome as well as areas to improve. Some of these changes might need to be facilitated in guidance.

We particularly welcome:

• the duty to consider lots, which we hope will encourage authorities to tender smaller contracts
• that a lighter touch regime has been kept
• greater transparency including pipeline notices
• the power for contracting authorities to direct suppliers to end legally binding arrangements with subcontractors. We hope this will address issues of charities being put into bids without giving them funding.

Our influencing of the bill will focus on six key areas.

1. Ensuring flexibility, prevention and collaboration specifically for procurement of public services for people,
2. How early market engagement and transparency can support working with the voluntary sector,
3. Ensuring value for money is interpreted broadly to encourage long term impact and prevention,
4. How we can prevent too great a weighting on cost saving in decision making,
5. Recognition of social value,
6. Ensuring the procurement review unit works for the voluntary sector.

It’s worth noting that an alternative provider selection regime has been proposed for health services.

We’re now working with Lloyds Bank Foundation for England and Wales and NAVCA to influence the bill as it moves through parliament. This will involve proposing amendments to both influence the bill and prompt discussion.

Right now we’re planning the best way to engage with members to share information and influence the bill over the coming months. This could involve influencing your MP in the autumn.

We’re always interested in the views and experiences of members. How do you think legislation or guidance could more effectively support culture change amongst procurement and commissioning professionals? Email us at policy@ncvo.org.uk with your thoughts or if you’re interested in hearing more about our work on procurement.