News

Procurement Capability Review programme continues to drive improvements

Released on 29/01/2010

The Office of Government Commerce (OGC) has today published the first tranche of Wave 2 Procurement Capability Reviews (PCR) for the Home Office, Department for Work and Pensions (DWP) and the Department for Communities and Local Government (CLG). The reviews reveal the progress made by these departments compared with the procurement capability improvement plans which were established following Wave 1 reviews.

Wave 2 reviews are self assessments which apply the same PCR Assessment Model used in the first wave.  This allows like-for-like comparisons to be made. Wave 2 reviews also have an even greater focus on performance measurement and use benchmarking data to help validate departmental qualitative evidence, providing greater transparency on the extent to which desired improvement targets have been met.  Departmental PCR self-assessment results are assured independently, either by OGC as for CLG, or external advisers as in the case of DWP, or via peer review where a senior representative from another department validates the results, an approach which the Home Office used.

Speaking about the publication of the reviews, Nigel Smith, OGC's Chief Executive said:

"I am delighted that the benefits of the Procurement Capability Review Programme are being recognised formally in the results of the second wave of reviews. The programme has resulted in commercial issues and risks featuring more at the top tables across government and more senior commercial directors being appointed. There has also been significant process efficiency. I think the scale of the improvement in CLG deserves particular mention. Continuous improvement should be at the heart of all commercial functions particularly given the importance of public procurement in the current economic climate and I look forward to more improvements later in the year."

Speaking about his department's PCR review, Home Office Group Commercial Director, John Collington said:

"I am delighted with the outcome of the Procurement Capability Review assessment, which confirms that the work of the commercial team has resulted in capability improvements taking the Home Office towards best in class in all areas. The PCR process, including the peer review, was robust and challenging. As well as helping to identify areas for further improvement it has provided assurance that our commercial transformation project is on track."

The Putting People First: Smarter Government plan published in December last year provided further impetus to strengthening procurement capability across the public sector, by building on the OGC's work. The proposals for smarter, more efficient government in the plan will release in excess of £12 billion a year over and above the £26.5 billion a year of savings which Government departments have already made since 2004 through the Gershon review and the further £35 billion a year to which we are already committed by 2011. They include £3 billion of new efficiency savings identified since Budget 2009 - of which over £1.3 billion will come from streamlining central government. Public sector procurement is a significant contributor to efficiency savings.

You can view the reports on the OGC website.

About the Procurement Capability Review Programme

The programme of Procurement Capability Reviews (PCRs) was first announced in Transforming Government Procurement in January 2007. The programme is central to the Government's aim to ensure that procurement drives public service improvements.

The PCR Wave 1 process was modeled on that of the programme of Departmental Capability Reviews operated by the Cabinet Office. There are, however, important differences: the two programmes are looking at different aspects of departmental performance. Cabinet Office teams look at leadership, strategy and delivery across the totality of a department's activity, while the PCR focuses solely on its procurement activities.

PCRs Wave 1 used in-depth face-to-face interviews to look in detail at three main elements of a department's procurement capability: leadership, skills development and deployment, and systems and processes. The reviews cover the widest definition of procurement covering all procurement activities throughout the product/service lifecycle from the development of policy and strategy through delivery and on to disposal are included. Spend throughout departmental delivery chains is also explored, including expenditure in central departmental functions, agencies, Non Departmental Public Bodies (NDPBs), partner organisations.  Departmental ability to act as an intelligent client both to assess commercial risk and influence procurement activity across their wider networks is also a critical component of PCRs.

PCR Wave 2 relies on self-assessment to deliver less invasive reviews compared with Wave 1 and are based on the same PCR assessment model used in Wave 1.  This allows direct comparisons to be made between Wave 1 and successive PCR waves.  However, PCR Wave 2 focuses more on using KPIs, and performance measurement to validate qualitative evidence and benchmark performance; which is in line with the recommendations contained in the Operational Efficiency Programme (OEP) and Smarter Government reports.

About OGC

The OGC is an independent office of HM Treasury, established to help government deliver best value from its spending. The OGC works with central government departments and other public sector organisations to ensure the achievement of six key goals:

• Delivery of value for money from third party spend;    
• Delivery of projects to time, quality and cost, realising benefits;   
• Getting the best from the government's £30bn estate;   
• Improving the sustainability of the government estate and operations, including reducing carbon emissions by 12.5% by 2010-11, through stronger performance management and guidance;   
• Helping achieve delivery of further government policy goals, including innovation, equality, and support for small and medium enterprises (SMEs);   
• And driving forward the improvement of central government capability in procurement, project and programme management, and estates management through the development of people skills, processes and tools.

OGC provides policy standards and guidance on best practice in procurement, projects and estate management, and monitors and challenges departments' performance against these standards, grounded in an evidence base of information and assurance. It promotes and fosters collaborative procurement across the public sector to deliver better value for money and better public services; and it provides innovative ways to develop government's commercial and procurement capability, including leadership of the Government Procurement Service.

Media contact:
Michael Dunning, Media Relations Manager, OGC
T: 020 7271 1318
M: 07771 815245
E: michael.dunning@ogc.gsi.gov.uk

Contact details:
OGC Service Desk
Tel: 0845 000 4999
E-mail: ServiceDesk@ogc.gsi.gov.uk