Covid and PPE Procurement

I think this is a very interesting submission from the UK Anti-Corruption Coalition to the Covid-19 enquiry.

My comments were;

Chris, great stuff. As my delegates will know, the late publication of PPE contract notices is a major gripe of mine (even allowing, as you do, for the difficult circumstances). That this was a deliberate attempt by government to escape scrutiny is (I think) an inescapable conclusion, leading to a huge loss of trust in public procurement and government. Even if no wrong doing were to be discovered, this is a terrible damage for the country. It was a deliberate choice by Ministers, who should be ashamed of themselves.
The facts that PPE was expensive, and fraudsters took advantage with sub-par products, are probably unavoidable. The damage to public trust was easily avoidable. It immediately leads people to think "there is no smoke without fire" and to suspect deliberate fraud and corruption at the highest level. In short, the exact opposite of what might have been intended.

Matt Hancock - acted unlawfully over contract transparency

 Second good article from Supply Management.

This time it is about the controversy over the failure of Matt Hancock (Health Secretary) to publish contract award notices within 30 days of award.

A few points about this.

Firstly, publishing late is not evidence of corruption, collusion, or "money for mates" as was suggested by some commentators.

Secondly, publishing late does raise eyebrows because if you were indulging in unethical/illegal behaviours in awarding contracts you would probably try to hide it (e.g. by publishing award notices either very late or not at all).  This is not saying there is no smoke without fire, but you can understand why people do say it.  This is why transparency has to be at the heart of public sector procurement - only if we can see what is going on can we be reassured that our taxpayer's money is being spent in the best way.  Late publishing of award notices may seem a minor issue, but it undermines public trust in government procurement.

Thirdly, there is no good reason for the late publication.  It is a relatively minor effort and should be undertaken as a matter of routine.  It is unconnected to the reasons why we may have gone for direct awards of contracts during the Covid-19 crisis (which may or may not be justified - it is a separate issue).  Personally, I suspect the hand of a well known provocateur at the heart of government who celebrated cocking a snook at the rule of law, standards and processes.  Thankfully he has gone (you know who I mean).

Finally, what is clearly wrong is that Matt Hancock authorised the use of government funds to fight a legal case it clearly had no chance of winning, and in which the government was unquestionably in the wrong.  This is an abuse of the legal system, and a waste of taxpayer's money.  The government's own legal team must have told the minister he had no chance of winning.  Instead Mr. Hancock decided to waste time and money during a health crisis.  

Whether the government was prudent or unwise in not having competitive tendering for PPE is something quite separate, and should be studied by an independent review.  It genuinely could be either case.

NAO - PPE Procurement: the threat for Public Procurement

There are many things going on at the moment, and so the procurement of PPE is not making as much of a splash as it should.  Though there is still a lot of coverage in the media;

ITV

Guardian

even Dentistry online!

And this should be a big issue.  At a time of national emergency procurement has to move fast, and decisions have to be made quickly.  But this is also the time when unscrupulous suppliers (and even conmen) can take advantage of the situation for gain.  So we have to temper the need for results with a little prudence.

The idea of having "fast track" suppliers is no doubt meant with the best intentions by senior figures in the government, who want to speed up the process - but this approach is fraught with opportunities for graft, corruption and fraud.  None of which have necessarily taken place, but it is a vulnerability.  

If you don't lock your car doors but it isn't stolen, that is not an indication that you were doing the right thing.  It means you got a way with it.  Time will tell if that is the case for PPE procurement.

What IS clear though is that public confidence in public procurement has been further eroded by the failure to deliver, the failure to ensure value for money and the perception of contracts for "mates".  The government should act quickly to restore its reputation.

Sad to say, I'm not holding my breath.

Public Procurement: Award of contracts by UK government

 You might be aware that there is growing concern about the award of contracts by the UK government during the Covid-19 pandemic without going through the usual tender processes.

This is of great concern, because of course the usual processes (mostly tenders) are there to ensure that our taxpayers money is spent in ways that are both effective and fair.  You can argue about the effectiveness, but the "fairness" should not be an issue.

The government's argument is of course that the current crisis requires a different approach.  Research by They Buy For You suggests that the UK government is taking a different line to other European countries who have mostly followed the existing procedures.  In the UK we have directly awarded 99%, resulting in the UK accounting for more than half of the Covid-19 direct awards across Europe.

Now taking such a different approach (one that risks fairness, openness and transparency) can be justified if it produces significantly better results.  

Your opinion may differ, but I don't see our UK Covid-19 response as significantly better than the rest of Europe.

What we have done is justified the award of large contracts (£100m upwards) to people known to the government without a competitive process.  I am sure that the government will say that the contracts went to good people.  But of course they cannot prove that they went to the best people.  Therefore the country risks being damaged by award of contracts on the basis of contacts and personal relationships rather than objective criteria.  No matter the intentions, this is how corruption, fraud and cronyism get into public sector procurement.

Pedro Telles points out that the Public Accounts Committee has been very critical of the government's approach.  

In a time of national crisis we deserve better than this.

More about current poor government procurement

Peter Smith over at badbuying.com is laying out some of the problems with the government's current approach to procurement.

Over at telles.eu Pedro Telles (always worth a read) is laying out some more.  He goes as far as to use the C-word; Corruption.  

This is not something we think about in the UK, but the whole of the EU (and current) UK procurement rules are based around trying to reduce the potential for corruption.  It is the elephant in the room.  The mechanisms chosen are competition and transparency - competition so that unless whole industries are colluding (and it does happen) we will get reasonable offers, and transparency so that everyone (suppliers and public alike) can see what is happening and complain if we see inappropriate behaviour.

Of course you can argue about how effective it is in practice, and whether there are other ways to avoid corruption, but that is the intention.

The Covid-19 pandemic has given an excuse (sometimes justified) to circumvent the usual processes. Sometimes this has happened even when existing frameworks could have been used.  It has become common to have very large direct awards without competition, and limited or no transparency at the time (or limited transparency at a later time when it is too late to do anything about it).

Now, there is a case that government is selecting good quality suppliers without having to go through red tape.  And that is usually the argument made - it is efficient.  Which may be true, but it is also the way you would choose to do things if you were wanting to corruptly appoint suppliers in return for backhanders or favours.  I'm not saying that is going on, I have no idea.  But the rules are there to try and reduce the potential for that sort of crime.

Criminals always seek to exploit difficult situations. We should be very careful, and recognise that the procurement regulations are not "bureaucracy" or "red tape" but a mechanism (however imperfect) for protecting the taxpayer.  That organisations such as The Taxpayer's Alliance are quiet about this, but not about wages for public servants, shows that they are not genuine about their purported purpose but are simply pushing a political agenda. (Which in itself would be fine if they were honest about it)