Passport Blues

Procurement
28th March 2018

Simon Lydiard reflects on the outcry over the contract for new, post-Brexit passports being awarded to a company based in the EU

There has been an outcry over the award of a contract to a French/Dutch company for the production of the new, blue British passports. It didn’t have to happen.

First of all, to be clear, the contract has not been awarded. It seems that a supplier has been identified as a “preferred bidder” – meaning that the process is, technically, in what is known as a “standstill” period, enabling challenges to be made to the decision.

Secondly, there is a degree of faux outrage here. Those who support Brexit, say they are in favour of international trade deals. The opening up of the UK market to EU competition is as a result of the trade deal we are part of in the EU. In the transition period we will be bound by the same rules. And when we leave we likely have to comply with EU procurement rules if we want a trade deal with them. We will also be bound by similar procedures if we trade under World Trade Organisation rules. International trade requires a degree of reciprocity of access. And let’s not forget that the UK-based company (some of whose work is done in France) produces the passports for some 40 other states – a great example of UK success in international trade.

Many claim that the UK is a slave to the rules, whereas other EU countries are quite happy to skew them to favour domestic companies. There is evidence of breach of the rules by other EU countries but the UK itself is not without sin. An overt decision by the UK to breach EU (and UK) law is not a sensible approach.

What many EU countries do well, and the UK does less well, is to work within the rules to develop sourcing strategies that give its own companies better chances of winning but without outright discrimination.

One way of doing this – completely permissible within the EU rules – is to develop sourcing strategies designed to encourage the participation of small and medium enterprises (SMEs). Working as the lead consultant for DragonGate Market Intelligence, I produced a report for the Crown Commercial Service last year making a number of recommendations for increasing government procurement spend with SMEs.

One of the opportunities we highlighted for greater SME participation was the passport contract. Like many contracts, it is one that requires a supply chain, which could be composed of SMEs. A critical question to ask is whether such a contract could be split up into its component parts – thereby making it far more attractive to SMEs and much less attractive to larger companies. Too often, public authorities make the lazy decision to “bundle up” contracts into larger packages, thereby requiring less effort to manage the contract by the public sector but also “locking out” SMEs.

“Bundling up” means that the public sector pays for multiple levels of private sector management – quite likely increasing the cost – and it creates the useful fiction that risk is being outsourced. The recent collapse of Carillion disproves this. Ultimately, the buck cannot be passed – the public sector always bears the risk for the delivery of public services.

So, the Home Office’s passport blues did not have to happen. Had they followed my advice, they would have sought to redevelop the souring strategy and contract specification to enable greater SME participation and – working completely within the rules – might have made it much more likely that UK companies could have won fairly and squarely. They might also have avoided attempting – and paying – to outsource risk that they were always going to bear.

Simon Lydiard is an Associate of DragonGate and a Founding Partner of Breaking Barriers Innovations.

Related articles

Securing National HQ of Great British Railways to Derby

In the teeth of determined civil service opposition, it was brave of the government to commit 750 top posts in the Treasury to Darlington and 500 in the Ministry of Housing and Local Government to Wolverhampton as part of the imminent Whitehall relocation programme and levelling-up agenda.

Read more

Moving Out: What are the Benefits of Civil Service Relocation? 

The Institute has produced a thought-provoking piece as Government prepares for a programme that will see 22,000 civil servants relocated to the English regions and devolved nations during the current decade. But there some important gaps in the paper with too much emphasis on the costs and too little on the very real savings and improvements that can be made, both in the short and the long term.

Read more

Farewell Quarry House!

The BBC’s news today about the Leeds DWP office failing to enforce social distancing following an Health and Safety Executive inspection brought back many memories of Quarry House – a building which carries the rather unkind soubriquet “The Kremlin”.

Read more

You Know When You’ve Been Quangoed

For Boris Johnson’s shellshocked government, there has been little instructive from the worlds of ed and med in recent weeks.

Blame has flown and political heat applied to previously little known quango Ofqual and the much criticised Public Health England (PHE) before its demise and absorption into the National Institute for Health Protection.  Before this, the secretary of state for health and chief strategic government advisers were, apparently, unaware that they had the power all along to direct and control PHE.

Read more

Track and Trace – Why is Serco in the Frame?

Serco was awarded a track and trace contract valued up to £400m, apparently without competition.

Actually, there was a competition – kind of. Serco competed for, and won a place on a government “framework” contract. In effect, it is a catalogue – enabling governments to call off goods and services, without the need for further competition. In this case, the contract was for call centre services, and awarded by the Crown Commercial Service.

Read more

Times Red Box: No 10 must be ruthless to wrench the civil service from London

In his March budget the chancellor indicated the government’s intention to move 22,000 civil servants out of London by 2030. Michael Gove, in his recent Ditchley speech, spoke of relocating Whitehall decision-making centres to not only the main regional centres such as Manchester and Bristol but different parts of the UK.

But this will be nowhere near enough, and the leisurely timescale will provide ample opportunity for further delay and obfuscation, as it has done in the past. What is needed is a truly ambitious programme to relocate the majority of the 85,000 civil servants in London leaving only a core elite of a few hundred.

Read more

Pathways, Place and Priorities

This week Breaking Barriers Innovations hosted the “Pathways, Place and Priorities” Roundtable, discussing the potential impact of digital technology upon the health and social care workforce. We spoke to DragonGate & BBI Programme Manager Rahim Daya, to get his insights into how this fits into the vision for the NHS Long Term Plan

Read more

Connecting the Regions Through Clean Growth

In light of DragonGate’s recent “Connecting the Regions Through Clean Growth” Roundtable, DragonGate Programme Manager George Evans-Jones answers our questions regarding the Clean Growth Grand Challenge

Read more

Out of Sync

Tim Philpott reflects on how local authority property transformation spending may be missing out on the bigger picture

Read more

Passport Blues

Simon Lydiard reflects on the outcry over the contract for new, post-Brexit passports being awarded to a company based in the EU

Read more

Building Transformation in the Public Sector

The demand and financial pressures on the public sector are not going away; but policy activity from central government could nevertheless be the basis for far-reaching local transformation – well beyond the aims of the individual strategies – for the benefit of those who really matter: local citizens. That was one of the conclusions of a recent DGMI round table, hosted and facilitated by Kinnarps.

Read more

Relocation is Good for Our Nation’s Health

In his interesting piece in The Times on the 20th January, Matthew Parris uses the recently published ONS figures that highlight the severe health inequality across the nation. The figures present a jarring picture of imbalance between the London population and the rest of the country…

Read more

Out of Sync: Local Authority Transformation is Missing Out on the Bigger Picture

Ongoing DragonGate research has established that 2018-19 will be a high watermark for Local Government property transformation, with approximately 70 projects due to be completed over the next 24 months. However, with adjacent sectors such as the NHS, Higher Education and Central Government implementing similar programmes for property transformation there is little evidence that opportunities for place-based collaboration are truly being embraced.

Read more

Prime for transformation?

The sustainability and transformation partnerships (STPs) programme should harness and drive digital innovation as a positive force to help overcome barriers to the integration of health and social care and improve standards of delivery

Read more

And Justice for All

Nothing less than a ‘whole-place’ pooling of public service budgets and devolution of criminal justice system powers to local level can create the conditions for community transformation

Read more