NAG/SOPO newsletter

Welcome to the NAG newsletter for February 2019. Please feel free to share with your networks.


News and updates

It is now possible for those people who responded to the NPS 2018 diagnostic to compare their own council scores within their region or to the national averages for the tier. Nominated contacts from each council should have received an email from LGA NPS Diagnostic (lga-nps-support@groups.nipltd.com) on 30 January with the details on how to access these reports. Please let us know if you haven’t received the email or need any further guidance. Please contact Guy.head@local.gov.uk. We will be discussing the overall results with NAG in March and are currently pulling together the high level findings for a short report that we will publish in the spring. Please let us know if you haven’t received the email or need any further guidance.

In addition it is now possible for those people with regional report access for the NPS 2018 diagnostic to compare regional averages to the national average, or to compare specific authority scores within their region to the regional or national averages for the tier. Details on how to access the report can be found at how to view reports with detail on how to get to the comparison reporting in point 8.

One of the emerging findings from the diagnostic exercise is that councils want to hear more about how they embed social value into their commissioning and procurement processes. We are working with the Social Value Portal to develop a two day course that we are piloting in April.  See below (Events section) for more details. We have limited space for 20 delegates only so please book early if you are interested. On the subject of social value there is an article in Supply Management this week that might be of interest. Caring or cost? The price of social value

We had a great Construction Conference at the beginning of February with lots of really interesting speakers including Dame Judith Hackitt who presented an update on progress following her review of building and fire safety. The Government has accepted her recommendations in full and is now working to implement these. Colleagues from NAG and our construction steering group are working with the industry on a number of competency groups, designed to ensure that anyone involved at any point in the specification, design, procurement, building, maintaining of high rise residential buildings are accredited to do so. Other sessions included social value in construction, whole life costings, fair payment, soft landings, managing risk and improving mental health in construction.  View the slides from the conference.

In December 2017, the Government published its Anti-Corruption Strategy for 2017 - 2022. That strategy identified risks around public sector procurement, and the Ministry of Housing, Communities and Local Government (MHCLG) is leading a review into the risks of fraud and corruption in local government procurement. Following a series of workshops over the last few months the second phase of the review will focus on gathering case studies and examples of best practice, as well as establishing an evidence base via the survey below. A report on the findings of this review will be published later in the year, and will include case studies and examples of best practice, to enable improvement in this area. Is anyone willing to share with Laura.Hough@communities.gov.uk. Please feel free to contact Laura for further information.

  1. Case studies of fraud and corruption in procurement can be provided on an anonymised basis, as the focus is on understanding how the fraud or corruption was perpetrated, discovered or prevented. If the cases are already published, feel free to simply send a link to the incident
  2. Examples of best practice in prevention, detection and management of fraud and corruption within the procurement cycle

Any case studies and examples of best practice can be shared anonymously and no councils will be named unless they wish to be referenced.   

MHCLG would also be grateful if you would take 10 minutes to complete a survey, which seeks to gather information about the activities of the Counter Fraud and Procurement functions in relation to the risks of fraud and corruption within the procurement cycle.  Please complete the survey by Thursday 14 March.

There’s been quite a lot of activity and discussion on outsourcing at the moment. The Institute for Government published a document in December on The Scale and Nature of Contracting in the UK and is currently developing another piece specifically on outsourcing (see below). Central Government has also produced guidance on outsourcing that captures best practice from across government and highlights where different approaches and new behaviours are required. These are captured within 11 key new policies that all central departments are expected to follow. Some of this will be relevant to local government as well. We will be having a conversation about this at NAG in March. Your thoughts to your local NAG representative prior to then would be welcome – Outsourcing Playbook

The Institute for Government is an independent think tank working to make government more effective. It is currently conducting research on what has and hasn’t worked in government outsourcing (including local government) in the last decades. It is looking for case studies of local government outsourcing successes or challenges, along with supporting evidence. If you have examples you would like to share or discuss, please email outsourcing@instituteforgovernment.org.uk

A revised Clean Vehicles Directive agreed recently by the European Parliament and EU Council sets binding public procurement targets for 2025 and 2030, in a bid to cut transport emissions and support clean air policies.  The new rules will apply to public transport, refuse collection, postal deliveries and other services, with the most ambitious targets applied to buses.  Countries will have to ensure that by 2025, between 24 per cent and 45 per cent - depending on population and GDP - of buses procured by local authorities and public companies are clean. The target range will increase to between 33 per cent and 66 per cent by 2030. The new directive also sets targets for procurement of heavy-duty vehicles such a refuse collection trucks, of which between 6 per cent and 10 per cent must be clean in 2025, and 7 per cent to 15 per cent in 2030. For cars and vans the procurement target varies by country from 18.7 per cent to 38.5% per cent with the vehicles producing less than 50g of CO2 per kilometre in 2025 and zero emissions by 2030. The provisional agreement on the Clean Vehicle Directive will be translated into binding legislation after formal endorsement by the European Parliament and EU Council.  Obviously the applicability of the Directive in the UK will depend on a range of Brexit-related factors.

We have mentioned previously the work we are doing with Microsoft on software licensing. Microsoft has asked us to disseminate some further information about their position on Brexit which I set out below. If you want to receive updates on the work we are doing on Microsoft please let me know and I will add you to the contact list.

Microsoft’s position on Brexit 

Microsoft recently offered its perspective of the proposed EU withdrawal agreement. We also recommend reviewing the opinion we expressed pre-EU referendum, which makes clear our commitment to our staff and business in the UK. This has not changed. We have a long history here. It’s where we opened our first international office in 1982 and we have been investing in the UK ever since. We have more than 5,000 highly qualified people working in fields including support, marketing, gaming, communications, cybersecurity and computer science research. We’ve built a global centre of excellence for the development of artificial intelligence and other computing disciplines. We’ve also worked in partnership with innovators, entrepreneurs and people with a passion for technology to help to create a thriving partner network of around 25,000 British businesses. We will continue to monitor the regulatory landscape to ensure our investments continue to meet the needs of customers and partners.

Supplier information 

Regardless of our own commitment to the UK, we appreciate that each of our customers and partners have their own, unique challenges with Brexit (some of which are reflected in pro forma Brexit supplier questionnaires). We’ve been focused to help ensure that using Microsoft as a supplier is not one of those challenges. To that end we provide the information below: 

Cloud services
We are not aware of any issues impacting the use of Microsoft cloud services after Brexit and will be closely monitoring the EU (Withdrawal Agreement) Bill and any further trade negotiations. 

Supply chain
We have conducted a product flow map related to retail, commercial and online store flows between UK, Ireland, and other member EU states and vice versa. Furthermore, we are completing a systems readiness and digital transaction flow assessment to assure minimal disruption in the case of a "no-deal" Brexit. We review these plans with our suppliers, distributors and logistics partners regularly. Our focus is on maintaining our high standards of services at all times for our customers and partners. We are undertaking a thorough audit of all services provisioned in the UK and currently do not see any risks associated with service levels. Given the pace of change and the lack of clarity, we will as always keep our customers top of mind should the situation change, or we anticipate disruption. 

Pricing
Microsoft periodically reviews its pricing to align with market dynamics and to ensure it meets with the needs of our customers, partners, and the marketplace across the region. We make any necessary changes in response to this assessment and feedback. Many factors contribute to our ongoing assessment of local and regional market dynamics including competition, pricing, business models, local currency rates and local inflation.   

Trade and tax
Most of our products and services are exempted from WTO tariffs under the International Technology agreement signed by 29 WTO members in the Singapore 1996 WTO Ministerial Conference, therefore, we expect minimal to no disruption in trade activities in the case of a “no-deal” Brexit.

Data protection and location of data
Microsoft’s enterprise cloud contracts clearly state that as of the start of enforcement of the GDPR (May 25, 2018), Microsoft ensures that transfers of Personal Data to a third country or an international organization will be subject to appropriate safeguards and will be documented, in each case, according to applicable law including Articles  46 and 30(2) of the GDPR. Microsoft has shared its perspective on the proposed EU Withdrawal Agreement and believes that it protects the businesses of our customers and partners by helping to ensure the free flow of data across borders.  For questions on data location, please see the Data Management at Microsoft page on our Trust Center and the Compliance Resources for the United Kingdom in the Services Trust Portal.

We have recently been speaking to a member of the DfE’s Schools Commercial Team (SCT). The team was created by the Department to work with schools and help them identify ways to save money on their non-staff spend. One of their initiatives is ‘Deals for Schools’. Category experts have reviewed a wide range of public sector frameworks and identified those that are most suited to schools. There are 38 recommended deals that cover four broad category areas: Business Services, Facilities Management, ICT and Utilities.

SCT is working with stakeholders to support and develop networks for schools business professionals. It is active in local communities and events but getting the message to all schools about their initiatives is a huge task; it has asked for our help in this by sharing the following links Deals for schools and SBP Networks.

The Joint Industry Board has informed us about a new online service called ECS Check which allows clients and main contractors to verify the skills of electrical staff working directly or through contractors. The quality of an electrical installation depends on not only the electrical contractor’s company registration but, crucially, the person carrying out the work. The ECS already verifies applicants’ qualifications in order to issue them with an ECS card – and has done so for over 50 years. There are around 70,000 electricians working at ECS Gold Card level to show they meet the industry-recognised standard. Clients, main contractors and project managers can have confidence in the quality of the electrical workforce on their projects through ECS Check’s online portal, which allows users to validate the electrical workforce on site and produce electronic summaries for auditing and reporting. ECS Check is free to use for any local authority, main contractor or client.

Whilst looking at single use plastics we have been sent this link from Keith Coleman at Surrey Single-Use Plastics (SUP) Policy. It also has a draft SUP Strategy that is awaiting sign-off.  Hopefully I will be able to share this with you next month. This may also be of interest, a recent updated policy from the Ministry of Justice, which could be useful to those councils looking to set out policies on plastics.

Through the LGA Shared Service Expert Programme, STAR Procurement was able to access support from a shared service expert who worked with its senior management team on a range of aspects to help plan newly secured and for future growth. The return on investment has increased for the founder partners, efficiencies are being driven from economies of scale from collaborative procurement as well as operating efficiency with a leaner workforce. Immediate savings of £230,000 have already been delivered for Tameside Council in the first few months. STAR Procurement has also been able to deliver £6.3 million of ratified savings to its three founder councils so far this financial year, while also managing this growth programme.
Growth options for a successful shared service

A colleague has been asked to come up with a comprehensive list/inventory of goods and services, (Local Government Sector ‘Basket of Goods’) by department/category. We are almost certain that something might already exist but a trawl through Google has not come up with anything specific. Can anyone point us in the right direction?  Please contact guy.head@local.gov.uk if so.

The Independent Review recently published its second interim report on Modern Slavery in the Supply Chain. The aim of the review is to report on the operation and effectiveness of, and potential improvements to, provisions in the Modern Slavery Act 2015. The review will aim to report to the Home Secretary before the end of March 2019. On completion, the review is to be compiled into a report, including recommendations, to be presented to the Home Secretary for approval. Of particular interest to councils and indeed procurement officers, will be the two recommendations outlined below:

  • Section 54 should be extended to the public sector. Government departments should publish a statement at the end of the financial year, approved by the Department’s board and signed by the Permanent Secretary as Accounting Officer. Local government, agencies and other public authorities should publish a statement if their annual budget exceeds £36 million.
  • Government should strengthen its public procurement processes to make sure that non-compliant companies in scope of section 54 are not eligible for public contracts.

See - Independent Review of the Modern Slavery Act for more information.

Did you know that all public sector organisations in England can procure skills quickly, compliantly and at a competitive price with the LGA’s Commercial Skills Procurement Solution framework. Procured under OJEU regulations with YPO and resourcing partner Reed, the framework complements internal procurement policies and features a wide range of national and regional commercial experts. To find out more visit the CSPS web page.

A new Procurement Policy Note has been published today on Applying Exclusions in Public Procurement, Managing conflicts of interest and whistleblowing.

We are still waiting to hear more news about Brexit and how this will affect councils' procurement activities. There’s quite a lot of information on the GOV.UK website as outlined in previous newsletters and I suggest colleagues might keep abreast of any new information on this site.    

The LGA has a specific page for Brexit that covers other policy areas that affect councils.

Colleagues in Northern Ireland will be aware of the Department of Finance website and information on public procurement contained in there. nI was interested to see that NI have recently published a collaborative procurement dashboard, which I thought was a nice idea. It’s always interesting to see how procurement is managed in other areas. 

Events

Commercial skills for councillors masterclass 
19 March 2019
The Midland, 16 Peter Street, Manchester, M60 2DS

Join an LGA member peer and an experienced commercial trainer to learn practical commercial skills and to hear a case study from the LGA member peer about how these skills have been put into practice.  For more information and to book visit the Commercial skills for councilors web page

Getting the Most from Social Value in Your Commissioning and Procuring Processes
3and 4 April 2019
LGA Offices, 18 Smith Square
£400

This short course is aimed at local authority officers who want to embed social value into their processes. The course will provide details of the framework for seeking social value, setting out a methodology for measuring social value, providing techniques for embedding social value into your commissioning and procurement processes. It will also explain processes for ensuring delivery of social value offers made by bidders through contract management. You will hear about actual case studies showing how this works in practice.  For more information and to book a place please follow this link 

Procurex National Conference
30 April 2019
NEC Birmingham

Against a backdrop of an annual UK procurement spend of over £240bn, Procurex National, part of the inaugural UK Public Sector Sourcing Expo, will bring together over 1500 key decision makers who contribute to the ongoing delivery and strategic development of public sector procurement as well as over 100 market-leading suppliers from across England, Scotland, Wales and Northern Ireland – making it one of the major highlights within the annual procurement calendar, supporting innovation, education, collaboration and celebration over a single dedicated day. Entry is free. Come and see us on our stand!