Friday 19th Jul 2019 - Logistics Manager Magazine

Procurement policies for £49bn spend are changing

Companies bidding for government contracts in the future will need to show that they are tackling issues such as modern slavery and climate under a new evaluation model for central government buyers.

Cabinet office minister David Lidington, said: “Every year, the government spends £49 billion with external organisations and it is morally right that we make sure none of that money goes to any organisations who profit from the evil practices of modern slavery.

Malory Davies, FCILT, Editor.

Malory Davies, FCILT, Editor.

“Similarly, it is right that we demand that the organisations we work with meet the high standards we need to protect our environment and employ workforces which represent our diverse society, including people with disabilities and those from ethnic minorities.”

The strategy is being put out to a public consultation “Social value in government procurement”.

The consultation document makes it clear that the intention is to ensure that central government departments will be required to take account of social impact as part of the award criteria.

The new evaluation model sets out how a government department would be expected to evaluate supplier responses as well a proposed policy metrics.

For example on environmental sustainability, it would be looking for responses setting out how the prime contractor and any key suppliers in the supply chain would minimise or mitigate any negative environmental impacts. And metrics would look at the number and type of initiatives and the annual percentage by which environmental impacts will be reduced in the delivery of the contract.

And on modern slavery it would be looking for:

* Number and type of initiatives throughout the supply chain to identify and manage the risks of modern slavery occurring (i.e. supply chain mapping, staff training, contract management) in relation to the contract

* Number of supply chain audits to be undertaken in the supply chain, to identify and manage the risk of modern slavery occurring in relation to the contract

* Number of people employed to Tier 2 in the supply chain to identify and manage the risk of modern slavery occurring in the supply chain, in relation to the contract

The consultation suggests that the government will train all 4,000 of its commercial buyers in how to design procurement to deliver social value effectively and efficiently.

Clearly, this change in government procurement practice could have a significant impact on its supply chain partners. Companies have until 10th June to respond.