30 May 2008
A new procurement procedure designed to elicit more speedy decisions is not working well, business leaders said this week.
Latest CBI research has found considerable unhappiness among businesses over how 'competitive dialogue' is working in practice.
Competitive dialogue was introduced to the public sector procurement process by the European Commission in January 2006, with the intention of encouraging better and earlier communication between procurers and suppliers. It demands significant preparation from procuring authorities, which need to develop their service specifications, agree appropriate internal policies and recruit well resourced procurement teams.
But the CBI is concerned that such preparation is either not taking place or not being done sufficiently. It is calling on the National Audit Office to carry out a study on its use, to evaluate the timescales and costs of competitive dialogue procurements against those of other schemes.
James Fothergill, head of public service procurement at the CBI, told Public Finance the organisation had been surprised by the amount of negative reaction to the process: 'Our members have experience [of] where the process is not being handled correctly.
'Authorities are not doing the upfront engagement and thinking behind what outcomes they're looking to procure a service for, and are relying on the dialogue bit of the procedure for providers to come forward and do their thinking for them,' he said.
Fothergill added: 'It's not the procedure itself that's broken – it's a procedure that members supported when it first came in – but it really does impact significantly if handled incorrectly. It adds time and costs to procurement,' he said.
The report highlights some examples of good practice, including a post-procurement analysis conducted by the Olympic Delivery Authority drawing out success factors and key risks.
The CBI is looking to the new joint Treasury–Office of Government Commerce guidance, promised in this year's Budget, to improve understanding of where it is appropriate to use competitive dialogue in the procurement process.
The guidance, which is due to be published shortly, will stress the importance of ensuring competitive dialogue is the correct procedure for the procurement in question, highlight the need for extensive planning and provide practical advice.
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