Paul CharkivPaul CharkivHead of Efficiency and Procurement WLGA

Paul CharkiwPaul Charkiw

Local Government Local Government Procurement in WalesProcurement in Wales

““Sharpening the Public Procurement Pencil”Sharpening the Public Procurement Pencil”

Bangor University Law SchoolBangor University Law School10 October 201210 October 2012

The Welsh Local Government Association (WLGA) represents the interests of local government and promotes local democracy in Wales. It represents the 22 local authorities in Wales and the 4 police authorities, 3 fire and rescue authorities and 3 national park authorities are associate members.

The WLGA’s primary purposes are to promote better local government and its reputation and to support authorities in the development of policies and priorities which will improve public services and democracy.

Welsh Local Government Association

Local Government Procurement in Wales – An overview

“Sharpening the Pencil”

Presentation

Estimate of Total Procurement Expenditure of Welsh Public

Sector Annual Expenditure £4.3bn

LG Procurement Expenditure 2010/11

£2.4bn by Local Authority

£0

£50,000,000

£100,000,000

£150,000,000

£200,000,000

£250,000,000

£300,000,000

LG Procurement Expenditure 2010/11

£2.4bn

Construction Social Community CarePublic Transport Environmental ServicesInformation Communication Technology UtilitiesHuman Resources Facilities & Management ServicesVehicle Management Financial ServicesConstruction Materials CateringConsultancy Highway Equipment & MaterialsEducation Arts & Leisure ServicesLegal Services HealthcareCleaning & Janitorial Horticultural

£670m

£522m

£183m

LG Procurement in Wales

LG Procurement Consortia

North Wales Procurement Partnership

Welsh Purchasing Consortium

The Institute for Fiscal Studies (IFS):

“The financial situation for Unitary Authorities looks difficult until at least 2020-21"

In what the IFS calls its "most pessimistic" scenario, councils' spending power will fall by 18%.

“Such a bleak financial climate means that councils may be forced to cut, or scale back spending on a vast array of services that they have traditionally delivered.”

Councillor Aaron Shotton, WLGA

“Sharpening the Pencil”

Public Sector procurement - to achieve savings AND support SMEs in Wales

Collaboration and development of national and regional procurement consortia

E-procurement

Common Processes and Documentation

Review of the EU Procurement Directives

Review Reports: Reform of EU Public Procurement Policy - NAfW Maximising the Impact of Welsh Procurement Policy –

McCelland Review

“Sharpening the Pencil”

Reform of EU Public Procurement Policy - NAfW

Maximising the Impact of Welsh Procurement Policy – McCelland Review

Overview Shortage of qualified procurement capacity

resource

Lack of procurement management information

More collaboration needed – NPS

E-procurement

Next Steps…….Public Procurement Policy Statement

- Jane Hutt, Minister for Finance, Welsh Government (scheduled for Autumn ’12).

Review Reports

SME Support - Procurement Tools OJEU & sub-OJEU

Collaboration, Aggregation and Lotting

Organisational financial regulations and CPR’s

Market knowledge and experience

Communication and Advertising

Supporting SMEs in Wales

SME Support - Current Supporting Initiatives Squid

Construction

XChangeWales

Common Contract Procedure Rules

Common Documentation

Review of the EU Directives ……..

WLGA lobbying …..Simplification, flexibility…..SME support

Supporting SMEs in Wales

Estimate of Total Public Sector Expenditure to Wales Based Suppliers

%

0

10

20

30

40

50

60

2006/ 7 2008/ 9 2010/ 11

Supporting SMEs in Wales

FSB Report

The report was based on their ‘UK Voice of Small Business’ member survey, February 2012 and a further survey of public sector procurers in local government across the UK.

This closed in May 2012 and included data from 8 Welsh Unitary Authorities.

FSB ReportObservations, specific to Welsh Local Government: Over 85% of authorities responding in Wales record the

amount they spend in their local authority boundary

All of the authorities in Wales felt that their procurement strategy linked ‘very well’ or ‘well’ to wider corporate priorities.

All of the authorities responding from Wales used the Sell2Wales electronic portal to advertise tender opportunities; Only 53 of 119 authorities in England responding to the survey utilised a national portal such as Contracts Finder.

Supporting SMEs in Wales

FSB ReportThe report concluded that Welsh unitary authorities would: be more likely to record local spend;

have greater levels of spend in their local authority boundary;

be more likely to record SME spend;

be less likely to think SMEs face barriers in accessing procurement opportunities;

be less likely to use different processes for below EU threshold tenders;

be more likely to use national portals for advertising tender opportunities;

be less likely to think achieving cost savings is an issue of high importance.

Supporting SMEs in Wales

FSB ReportReports average SME spend by geographical

area:

Supporting SMEs in Wales

London 27%

South West of England 43%

Scotland returned 51%

Wales reported as 61%

Influencing the Modernisation of EU Procurement Policy (May 2012)

National Assembly for Wales Enterprise and Business

Committee

Recommendation 3:

The Welsh Government to provide Welsh local authorities and other public contracting authorities with strong guidance on achieving the appropriate balance between risk management and creativity in public procurement……..

“Let a million flowers bloom”

- Chairman Mao

Paul CharkiwPaul CharkiwHead of Efficiency and Procurement WLGA

Local Government Local Government Procurement in WalesProcurement in Wales

““Sharpening the Public Procurement Pencil”Sharpening the Public Procurement Pencil”

Bangor University Law SchoolBangor University Law School10 October 201210 October 2012