Saturday, 7 March 2015

Best Value and Gold Plating of UK Public Sector contracts

Local government minister Kris Hopkins has apparently accused the public sector of "gold plating" procurement requirements in the proposed revision of the Best Value guidance for local authorities.

Article in Supply Management and the proposed revision itself.

His suggestion is to minimise unnecessary paperwork and a tick box mentality, which I think is something that we can all support.  Though to be honest it is not my definition of either Gold Plating or Best Value - it is more about efficient processes.

Whether gold plating is common is something the Minister will have more data on than me, but I think we can consider why it might happen - there is no upside to public sector procurement.  In a commercial environment any savings or added value go through to the bottom line, and add to profits with (hopefully) bonuses all round.  In the public sector any money saved just goes back into government coffers to be used elsewhere.  Any added value is possibly not appreciated (and possibly seen as gold plating itself) (Personal recent example - I bought a First class train ticket for less than the equivalent second class fare.  Don't ask me how that works.  But if I worked in the public sector I bet there would be complaints that "we don't pay for first class travel" regardless of the fact is was actually saving money).

On the other hand any problems in public sector procurement can be very visible, and the procurement professionals might be the ones offered up in sacrifice to the media rather than the relevant Minister or Chief Executive. 

Whenever there is no upside and a very large potential downside then people tend to become risk averse and insist on belt, braces and a second belt just to be sure.   That might lead to gold plating of specifications.

Paradoxically allowing procurement to occasionally fail (a more commercial approach) might actually lead to more success.

Incidentally, the Best Value document mentions British Values - which is one of those things we all know what we mean but is very difficult to put down clearly in words.  Though democracy, the rule of law, individual liberty and mutual respect and tolerance of different faiths and beliefs (all listed) are part of them I am not sure that they are either definitively British or comprehensive.  A topic for another post I suspect.

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