Written - The work of the Business Procurement Task Force and response to the “Barriers to Procurement Opportunity” report

In 2004, I established the Business Procurement Task Force. This is a good example of a social partnership bringing together the public, private and voluntary sectors to benefit the people of Wales. The membership was drawn from the Wales CBI; FSB; the Wales TUC; WLGA; Third Sector; Academia and other parts of the Public Sector.  The Task Force aims at getting the maximum possible benefit for the ‘Welsh Pound’ from the £4.3 billion a year spent on procurement by the Public Sector in Wales.

One of the most important outcomes of the work of the Task Force was the policy document “Opening Doors – the Charter for SME Friendly Procurement”, which I issued in 2006. Opening Doors seeks to secure economic and social benefits by encouraging more Welsh SMEs to seek to supply the Welsh Public Sector.  Over 90% of our businesses are SMEs and so encouraging their growth is important to the economic future of Wales; every additional 1% increase in spend with Welsh companies could result in an additional 2,000 jobs. All major public sector organisations have signed up to these principles.

In 2007 the One Wales agreement made a commitment that, “by working within the European legal framework, (to) make it easier for small local firms in all parts of Wales to win government contracts.” This commitment re-affirmed the work of the Task Force.

Research has been undertaken to track our success in opening up opportunities for Wales-based companies. This research commissioned by the Task Force indicated that in 2004, Wales-based companies were winning about 35% of public sector business. Research just concluded, based on 2007/08 accounts, indicates that Wales-based companies are now winning over 50% of public sector business and 56% of Local Government business. This represents a significant boost to the Welsh economy.

Despite this significant and valuable progress there is anecdotal evidence that companies, particularly smaller companies, are still finding some difficulty in bidding for Welsh public sector business. I therefore commissioned a research project to investigate the barriers still being faced by SMEs and to make recommendations.

This research was conducted by University of Glamorgan in conjunction with Bangor University and Trinity College, Carmarthen.  The report entitled “Barriers to Procurement Opportunities” was published in the spring of this year.

I welcomed the report and broadly accepted its recommendations, six of which are already enshrined in the Opening Doors Charter, especially: making contracts more accessible; advertising of all contracts over £25,000; and standardising selection and pre-qualification processes; and incorporating a complaints procedures for procurement.

I have asked my officials in Value Wales to develop a Route map for taking forward the recommendations in consultation with both public sector partners and the supply side.  This work is underway and includes a series of workshops, meetings and focus groups aimed at standardising and simplifying the process for companies bidding for contracts in Wales.

Engaging with local suppliers in all sectors is a key focus of the Task Force.  For example:  Prince’s Gate Water in Pembrokeshire now supplies bottled water and coolers to universities across Wales; and Aberystwyth University, through its trading arm, is providing Welsh meat to sister universities as well as winning prizes at the recent True Taste of Wales awards.

The use of social or community benefit clauses in procurement contracts, for example as a way of getting economically inactive people back into work is an increasing feature of public sector construction contracts.

There is a growing programme of projects using social clauses; a current example being the Church Village Bypass, where 60 economically inactive people have been recruited and trained to minimum NVQ level 2 including prolific offenders; a start-up catering business has been established; and 80% of sub contracts have been won by local suppliers.

The Task Force has also worked to safeguard employment for minority and disadvantaged groups by paying particular attention to the benefits of working with Third Sector organisations and invoking EU provisions that allow the reserving of contracts for Supported Businesses (e.g.Remploy) which have over 50% disabled employees.  

My challenge to the Welsh public sector along with our suppliers, through the work of the Procurement Task Force and including the “Barriers” Route Map, is to grasp the opportunities available so that we continue to build a stronger business sector in Wales.

We are on a long journey of change in public sector procurement to optimise business opportunities and strengthen the Welsh economy. The Procurement Task force has helped to make a real difference since 2004 demonstrating the value of continuing the social partnership approach.