Hooray. For once we’ve had a National Audit Office report that brings glad tidings for the industry (page 16).
The 100-page document is a thorough analysis of how well the government procures its public buildings, and it’s good news because it shows that a great deal of progress has been made in the past six years. Fifty-five per cent of projects were delivered to budget over the past two years compared with 25% in 1999, and 63% were delivered on time compared with 34% in 1999.
Importantly, the report reinforces a point that the industry has been making for some time: that some departments have followed best practice guidance from the Office of Government Commerce and some have not. It’s encouraging that the NAO provides a list of recommendations that, if followed, could turn all spending departments into model clients. That’s a big if, but the NAO reports to the powerful Public Accounts Committee, and is one of the few parliamentary bodies that the government takes seriously.
What adds weight to the report is that the NAO has costed the result of bad practice – it comes to £2.6bn a year. Alongside this, the Gershon review is demanding that, starting with the next financial year, departments deliver efficiency cuts of 2.5%. The audit office knows just how to deliver them: integrated supply chains, partnering, innovative design, fewer legal claims and improved whole-life costs. And in what may turn out to be a huge step forward for integrated working, the report urges departments to ensure that they operate fair payment systems and to consider the use of project-wide insurance. That said, it also suggests departments keep a degree of “competitive tension” within their frameworks – so it’s not all motherhood and Easter bunnies.
But perhaps the most important single recommendation is that the OGC take a much closer interest in whether departments are using best practice. Of course, the OGC has anticipated this call by drawing up a procurement blueprint for government construction clients. Much of this guidance, which we reported in our 4 March issue, and which ranges from minimum energy standards to compulsory membership of the CSCS for everyone working on a public sector site, is already in existence in one OGC document or another. This latest initiative is an attempt to bring this guidance together for the convenience of outlying government procurers and to bring it to the attention of those who ignore it or are unaware that it exists.
Let’s hope the OGC has the resources to supervise the rest of government – but with its remit being extended to cover the NHS, local government and the Gershon efficiency drive, that’s a big ask. And as the NAO report points out, the OGC has no extra resources to bear this heavier load. The NAO wants it to bring together a cross-departmental group of clients, which can share best practice – the re-formation, effectively, of the government’s client panel. That would certainly make sense. But if the government really wants to get the most out of the £35bn a year it is investing in new schools, hospitals, roads and social housing, it should get a senior Treasury minister to chair it.
Denise Chevin, editor