Leading economist Margaret Cuthbert draws on 15 years of research on Scottish public procurement in making the case that procurement in Scotland is shrouded in secrecy and wide-ranging reforms are needed to ensure transparency and accountability.Credits—
Margaret CuthbertDownload Now
The collapse of school walls in Edinburgh rightly focussed the public’s attention on the way Edinburgh Council had chosen to upgrade its schools through a public private partnership (PPP) arrangement. The following inquiry ‘into the Construction of Edinburgh Schools’, February 2017, concentrated on the construction of the schools, and found the procedures to be lacking.
Construction, however, is not the only public procurement issues that need to be addressed. For many years, Scotland has had systems whereby our representative bodies, the Scottish Government and Local Authorities have been using financial instruments and contracts to procure public buildings and their long-term servicing and maintenance. The terms of the contracts are such that it is difficult, if not impossible, for the public sector to release the information in the contract to the public – who are, after all, the ones paying for the project and requiring its services.
― Why is it that our public representatives are signing up to contracts where the public cannot see the terms of the contract? In the few cases where we have finally been given access to a contract and its financial model, we have found serious problems.
― Why is it, in the cases concerning public procurement, we continually have to resort to Freedom of Information requests which is time consuming, rarely frees the information requested on major public procurement projects, and of no benefit in regard to getting changes made in any existing contract? Helpful answers to requests for information concerning contracts and financial models have rarely been forthcoming.
― The third issue concerns the very powerful role that is being played by the Non-Departmental Public Body (NDPB) and the Scottish Futures Trust (SFT) in the public procurement of major projects. The SFT, set up in 2008, is a private company. It now has a major role in Scotland’s public sector build, maintenance and servicing of projects. Its presence in the procurement chain has resulted in the public finding it difficult, if not impossible, to scrutinise the decision-making process on the facility being built; the process of handing out contracts; the financial aspects of the contract; the effect that the project will have on the local community including on jobs, and on local businesses; and importantly the long term effect this is having on Scotland’s financial well-being and the ownership of what was once regarded as essential public goods.
― There appears to be no analysis of whether the methods now being used for public procurement of major projects are constructed in such a way that local businesses are missing out on the architectural work, on the maintenance and services work, and, for example, potentially innovative work that could lead to other contracts. Local businesses are involved but are far down the food chain and may not be in as advantageous a position as is desirable for them to grow and develop as they might otherwise have done.
― The fifth issue considered concerns the methods used by the Scottish Government, Health Boards, Prisons, and Local Authority Councils to raise finance for public procurement. The lack of Whole of Government Accounts for Scotland means that we have no idea what the effect on Scotland’s long term level of debt will be from these projects.
― The final issue concerns the need for a strengthening of the role which needs to be played by the relevant Parliamentary Committees in dealing with economic and financial issues.
― This paper is based on what information has been made available through published documents and through Freedom of Information and other requests on each of the above six areas. It draws on research carried out by Jim Cuthbert and I over the past 15 years.