Opposition leader David Cameron and shadow chancellor George Osborne are right to demand that public sector contracts with the business and third sectors should be transparent. Public service contracts and performance against these contracts should be published in ways that are accessible to service users, taxpayers, staff and the wider community.
This transparency should extend to sub-contracts and supplier contracts. The public has a right to know how money raised by its taxes and service charges are spent. Therefore, the logic of the proposal would be to extend it on a similar basis to all ‘in- house’ managed services, those delivered through partnership arrangements between public sector agencies and those delivered by joint venture companies involving public bodies.
It is questionable whether the threshold for publication should be £25k – this might lead to disproportionate administrative costs – but but this is not to challenge the principle. The threshold value may vary depending on local circumstances and the type of service, but should capture the vast majority of service contracts and major supply contracts. It should include all public private partnerships and private finance initiative contracts.
The kind of information that is made public could include
- details of the procurement process – what process; how many bidders; key evaluation principles and decisions; required specifications – outputs and/or outcomes
- the value of the awarded contract and the terms of payments
- performance ideally against specified outcomes and at minimum specified outputs – there is a case for a small number of indicators that would be easily understood and resonate with service users and the public and ideally would include customer satisfaction statistics
- performance payments and penalties
- any change control or contract renegotiation
- measures of the public sector client’s performance
- external audit or inspection reports
Whilst the premise should be for transparency on every occasion and throughout the contract’s lifetime it will be necessary at specific stages in the contracting cycle to restrict certain data and information from being made public if to do so would be detrimental to effective competitive procurement. However, there is no reason why such data should not be released at a later date once its ability to distort the procurement process has passed. Protocols could be easily be drawn up by the interested parties.
These measures would open up what too many people rightly still regard as a very opaque process and which many people view as a deliberate means of obscuring accountability and visibility of performance. However, in themselves they will not be enough.
Further measures that should be considered for all contracts over a certain value and/or which have critical impact on the well being of the community include:
- contract arrangements being subject to political scrutiny – by council scrutiny panels for all local contracts across the local public agencies; and by parliamentary select committees in the case of central departmental and agency contracts
- providers, their staff and the public sector client officials being required to participate in such scrutiny processes. The scrutineers should have access to all the necessary information and people – focusing on the client function as much as the provider or partner
- independent external audit processes – especially where there are ‘open book’ arrangements; and, where appropriate, external inspection of the provider, the client and their relationships (this is often the case now)
- citizen panels to monitor and review performance and behaviour of the providers and the client and to have a formal route to the decision makers
- rights of staff to have access to ‘whistleblow’ and to report serious concerns
Some of these measures are in place in some contracts but it is very much the exception and not the norm. This has to change. Democratic control and accountability demands more openness.
These measures would enhance confidence in what will be inevitably be a more mixed economy of provision. They should be introduced in a manner that ensures competitive neutrality between the public, business and third sectors. Their introduction should not be seen as a criticism of any one sector but a natural progression. No single sector need be defensive now that the Conservatives have opened the debate. Any measures would have to treat providers and clients on the same basis – for it takes two to “tango” in any contractual or partnership arrangement.
Osborne and Cameron are to be congratulated on this step forward for democratic transparency and accountability.
John Tizard is director of CPSP@LGIU
