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Collaboration and aggregation will inevitably lead to lower costs for Government agencies, something that is clearly unavoidable over the next few years. Aggregation of demand has another impact, fewer and fewer suppliers are able to compete for large scale contracts, as the suppliers with scale are able to trade volume for margins. This has a positive effect for the public purse, but what is the consequence for the diversity of our supply chains? If more and more business is aggregated to fewer and fewer suppliers, we're likely to see a fall in competition and the development of monopoly scenarios in the future. In spend areas like utilities and telecoms, regulators have been forced to develop competition through opening the market, selling off state run businesses and where necessary, breaking up monopoly businesses. This is fine where the state grants licences to operate in these sectors, but what about temp staff agencies or facilities management? What will happen if these categories of spend fall into a monopoly scenario? At the moment, this concept may seem a bit far-fetched, but the Government spend accounts for over 43% of spend across Europe. Over the next ten years European Governments will inevitably seek to outsource more and aggregate demand in exchange for larger, cheaper contracts. The movement of this amount of money in favour of companies like Mitie, Serco, Ranstadt and others could easily change competitive markets into non-competitive monopolies. The question is, how ready are we to protect competition in these markets, especially if it means reducing deficits at a slower pace? |
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Andrew Lansley has announced that under the Coalition Government's new health reforms that Local Authorities will shoulder the responsibility for public health services, with ring-fenced funding to follow. This is good news for many in Local Government, who recognise that their data on the community as well as local, geographical knowledge of an area will allow authorities to provide a better level of service. However, public health is not a minor task and it will take many authorities a long time before they are ready for a mass vaccination programme. |
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Word reaches us from inside the DCLG, the new Government has taken agin some words that were commonly used by the previous administration. The first is anything to do with 'regional' or 'regionalism', the second is 'commissioning'. It is not hard to see why regional politics is being frowned at. The Tories had always opposed regionalism as a wasteful project that delivered benefit to the citizen. With both ideological and financial arguments being lined up against regionalism it is hard to see how the Regional Improvement and Efficiency Partnerships can expect to last beyond March 2011. The more interesting news is that 'commissioning' has become a banned word. As a procurement professionals we have always been concerned that the term 'commissioning' was used to obfuscate and divert attention from the fact that a financial contract was being put into place in return for services. So it is fair to ask why social care has chosen to define its contracting as somehow different from the rest of a council's purchasing activity. However, Councils understand that budget cuts will force them to review the value that they derive from all of their suppliers and it seems churlish to suggest that the vocabulary of business will protect Social Care departments from scrutiny in the search for savings. |
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The budget makes it clear that the departments will be facing real cuts of around 25% in the coming months. Local Government is likely to face a similar challenge, yet at the same time health budgets are to be protected. As Iain Martin makes clear here, this could cause problems in the future, because there is a real need to tackle some obvious waste in the NHS. Martin argues that the problem will be that the efficiency initiatives planned for health will generate more money than can be reasonably ploughed back into health, especially when other departments are being cut so heavily. Councils risk becoming the Health Service's poor neighbours, they will be under pressure to cut costs dramatically at a time when the demand for their services will be increasing because of the aging population and the expected rise in unemployment. If that is the case, why doesn't the new Government allocate some of the NHS budget for investment in social protection, with Social Care teams becoming partially funded by NHS trusts? This may seem inappropriate when we consider the importance of housing and unemployment on social welfare, but is it not difficult to imagine that the NHS might look after the needs of those with dementia or those with severe alcoholism. |
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New laws on bribery laws will have implications for both HR and Procurement managers.
Due to be implemented at the end of 2010, four new offences will make commercial organisations liable if they fail to prevent bribery in their organisation:
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Ticon have an excellent track record of managing large scale awareness and change programmes for public sector organisations. We have worked on four nationwide projects for Central Government departments as well as regional programmes. 
