The recently passed Procurement Act has given the public sector an opportunity to boost innovation and deliver better services, according to a new report from the Connected Places Catapult (CPC).
It has published 'The Art of the Possible in Public Procurement', produced by the CPC's Innovation Procurement Empowerment Centre (IPEC), and encourages council leaders, innovation teams in public authorities and ambitious businesses to take advantage of the new possibilities.
This comes in response to the new Procurement Act 2023, which is said to provide public authorities with more flexibility in the relevant processes, having received royal assent last October.
Although the report has a broad procurement focus, the act could have significant implications for the way public authorities approach efforts to innovate with digital technology and data.
The report points to the introduction of the ‘competitive flexible procedure’ as the single biggest change in the act, giving creative contractors a ‘wider palette of colours’ on which they can design procurement procedures.
This relates to the importance of partnerships with suppliers and how they can be nurtured before tenders are published. Authorities can engage with a supplier to explore possibilities for solutions, then cement the partnerships in any subsequent contracts through means such as collaborative terms and conditions.
More than new tech
Among the points made is that innovation is not just about applying new technologies, and can be as much about deploying existing tech in new ways, and an innovation that solves a problem in one part of a large organisation can often provide benefits for other parts.
There is also an opportunity to exploit the rules as enablers, through approaches such as integrating social value into procurement, shaping tenders to make them attractive to small businesses, and emphasising the potential to support the creation of new businesses, improve supplier diversity and respond to climate change.
Another approach would be to cultivate a mindset that every procurement has the potential to contribute a new idea and generate new economic activity, with challenging goals specified in the broadest way possible.
The report says the act provides just one step in making public authorities more ambitious in innovation. The training and development investment in disseminating the legislation should evolve into a rolling programme of culture change.
Smarter spending
Speaking at the report’s launch event, Rikesh Shah, head of IPEC, said: “The Procurement Act 2023 reinforces the ability of public authorities to get better value for money by getting smarter with their spending. In recent years, technology has changed at such a rapid rate that new types of innovators are emerging. This is creating a huge opportunity for public authorities to unlock value.
“Every procurement made has the potential to support a new idea and generate new economic activity. By further empowering public authorities as they get smarter with spending, we can support more diverse suppliers and find more cost-effective, sometimes more localised solutions to our biggest challenges.”
Malcom Harbour, associate director at the CPC, commented: “The very best procurement processes set challenging delivery targets, responding to national and regional priorities and stretching the innovative capability of suppliers.”
CPC said that the UK public sector spends approximately £300 billion per year on procurement, with £70 billion being in local government.
The Art of the Possible in Public Procurement can be accessed here.
