The Government has developed new public procurement guidance designed to improve how it works with industry and with the voluntary sector.
Launched by the Cabinet Office at the end of February, The Outsourcing Playbook sets out a series of key new policies for making outsourcing decisions and contracting outside suppliers for the delivery of public services. Written primarily for commercial, finance and project delivery professionals, the playbook aims to provide guidelines, rules and principles that will help to avoid the most common errors observed in outsourcing projects. It includes changes to how the Government allocates risk between itself and its suppliers to guarantee that contracts are set-up for success and to ensure that the public are provided with the best possible service. The emphasis is on “getting things right” from the very start and avoiding the sort of costly mistakes that led to the collapse of Carillion in January 2018, for instance, and the ongoing difficulties of some companies in the outsourcing sector.
Key new policies and measures included in the playbook include the following.
Requirement for Pilots — where a service is being outsourced for the first time there is a presumption that a pilot should be run enabling the Government to learn from experience and deliver better public services.
Risk Allocation — proposals for risk allocation will be subject to greater consideration and scrutiny to ensure contracts are set up for success from the outset.
Key Performance Indicators — all new outsourcing projects must include performance measures that are relevant and proportionate to the size and complexity of the contract and which will be made publicly available.
Publication of Pipelines — Government departments will be required to regularly publish their upcoming requirements to help suppliers plan ahead.
Resolution Plans — suppliers of critical public service contracts must provide resolution planning information for the rare event of the supplier’s corporate failure.
Make versus Buy Decisions — Government departments must conduct a thorough make versus buy assessment before deciding to outsource a service in order to identify when it is best to deliver public services in-house or when there is benefit to drawing on the expertise of the private sector.
Pricing and Payment Mechanisms — these go hand in hand with risk allocation and will similarly be subject to greater consideration and scrutiny to ensure they incentivise desired behaviours or outcomes.
The publication of the new rules within the playbook follow reforms announced in recent months by the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office, David Lidington, to ensure that Government procurement is fit for the future, including putting social values at the heart of public service delivery.
Jon Lewis, the CEO of Capita, one of the suppliers which the Government has worked with to develop the new measures, commented on the playbook’s publication:
“Capita is working closely with Government to develop these reforms. This is a sea-change, both recognising the vital contribution the private sector makes in delivering first-rate public services, and then finding ways to do this even better.
“These new ways of working will place a stronger focus on establishing partnerships based on mutual trust and a joint focus on positive outcomes. This is fundamental to the successful procurement and delivery of public-sector contracts.”
The Outsourcing Playbook is available from the Government Commercial Function website.
Last reviewed 5 March 2019