Francis Maude is streamlining procurement rules across Whitehall in an attempt to double the share of the government’s annual £191bn procurement budget won by small and medium-sized companies.
The cabinet office minister, flanked by David Cameron, will today announce he is scrapping onerous “pre-qualification questionnaires” for SMEs to make it easier for them to apply for government contracts.
He is also instructing Whitehall to simplify “fantastically complicated” tender documents to open up the bidding process as well as encouraging mandarins to adopt a more private sector mindset when being pitched for business.
The goal is to get 25 per cent of all procurement contracts going to small businesses.
Today’s announcement is the culmination of 20 years’ work. In an interview with the Financial Times, Mr Maude says he first tried to shake up procurement as a Treasury minister in the early 1990s, writing a “gripping” white paper on injecting competition into the market. Brandishing a slimmed-down EU directive of procurement rules – still quite a chunky document – Mr Maude bemoans reams of red tape that businesses have to climb through in dealing with Whitehall.
“We’ve gold-plated EU directives. In the UK the average time for procurement is 77 weeks. In Germany, an EU country subject to the same rules and which obeys the rules, they do it in 40 weeks on average,” says Mr Maude. “The result of that is smaller suppliers get squeezed out because it’s costly, burdensome and they lose the will to live.”
He is confident that the coalition can help SMEs, undaunted that Labour’s considerable efforts failed to translate into much tangible success. “They may have talked about it, but you have to be quite interested in this stuff,” says Mr Maude. “Quite a lot of people in senior reaches of the government are people who have themselves run businesses.”
The push on procurement is only part of Mr Maude’s drive to bring some competitive edge to the machinery of government.
He believes Whitehall needs shaking up and to that end has installed some of the City’s big hitters on departmental boards as non-executives. He is adamant that the arrival of the likes of Andrew Witty, the chief executive of GlaxoSmithKline, Ian Cheshire, chief executive of Kingfisher, and Sam Laidlaw, chief executive of Centrica, is more than just a cosmetic gesture.
“No one has suggested for a second that you’re going to change the entire culture of a department by putting in a non-executive,” says Mr Maude, who on Wednesday hosted the induction of his first dozen senior appointees – one attendee said David Cameron and Nick Clegg both put in an appearance.
“What we will do . . . is to start to instil different behaviours within the departments and from those different behaviours will flow over time a different culture, a better culture.”
Lines of attack will include improving the quality of data management within departments, shaking up procurement and scrutinising business plans.
“I said, I guarantee you will find a lot of frustrations,” says Mr Maude, reflecting on the afternoon session. “You’ll find the quality of management information is much poorer than you’ve been used to expect in your organisation and make a fuss about it. Be demanding. Do not just say, oh well, it’s all crap. We’re going.”
But progress is slow, he concedes. Little concrete action has come out of Sir Philip Green’s efficiency review, which criticised the lack of consistent data as it identified billions in potential savings.
“There’s a lot of work going on, in improving the quality of management information. Philip did absolutely make the point – and characteristically he did it in stringent terms – that the quality of the data was crap,” says Mr Maude. “But [change] is not going to happen overnight. The systems just aren’t there.”