Chamber and committees

Would you like to comment specifically on the work that has been undertaken to date, Stephen?

One of the themes that has emerged from the evidence that the committee has taken is that the 2014 act is a good piece of legislation that was formulated on a largely consensual basis when it went through Parliament 10 years ago. There is also recognition that the act sits within a much larger programme of public procurement reform, preceding its introduction and since then.

One of the challenges that remains is around consistency of application, the variation that can exist between different contracting authorities and the perceptions that that can create among suppliers. We have sought to address that through providing a comprehensive suite of guidance, support, training and engagement. For example, on the Public Contracts Scotland website, you will find links to the procurement journey, the supplier journey, and the supplier development programme, to which we contribute funding.

We also keep a suite of guidance up to date, and we are always working to engage with stakeholders on the development of our policy. We recognise that there will always be challenges around the consistency of application, but the legislation provides a solid foundation, and we remain committed to continuing to engage with partners to ensure that we drive forward consistency.

The five pilots have been in place for a number of years. They are operating in different contexts in Clackmannanshire, Fife, South of Scotland, Glasgow and the Western Isles. We have seen real progress, and there has been good engagement with the Centre for Local Economic Strategies, which has produced reports on the activities that are taking place in the pilot areas. The committee is familiar with the positive feedback that has been received on increasing the impact of local procurement in some of those pilot areas.

There is not just the five pilot areas to consider. Other areas of Scotland have taken forward community wealth building ambitions. No conversation about community wealth building would be complete without referring to North Ayrshire Council, which was the pioneer in taking forward community wealth building in Scotland. We have seen North Ayrshire’s approach grow to a regional approach, bringing in East Ayrshire Council, South Ayrshire Council, the local health board, the third sector interface and the college. Further progress has been made on the ambitions that are set out in the 2014 act around sustainable and progressive procurement.

Community wealth building legislation is a programme for government commitment. We consulted on the legislation and published an analysis of it last year. We are considering in detail the next steps with regards to the feedback that we received via the consultation.

As the committee will be aware, procurement is just one of the pillars of community wealth building, albeit that it is an incredibly important one. Community wealth building can add value by bringing about strategic coherence across the five pillars, which is one of the reasons why we committed to legislation in the PFG. I could say a huge amount about community wealth building, but I appreciate that that might be straying beyond the specifics of what we are considering this morning.

I respect the autonomy of local authorities in taking the decisions that they feel are best for their areas. They have to operate within the requirements of domestic procurement law.

I will pick up on the point that Graeme Cook made and the point about East Ayrshire that you made, Mr Whittle, and which we discussed. There is always power in an example. We can talk theory, but the examples that other local authorities can provide and sharing examples of best practice can serve to demonstrate what the opportunities are to those local authorities where practice might be inconsistent.

However, I have to respect that it is for individual local authorities to take those decisions. They must operate in a way that is consistent with the requirements of the legislation but, ultimately, decisions must be taken by elected members who are democratically accountable to their electorates.

I would be speaking beyond my portfolio responsibilities if I strayed into the territory of food regulation and its specifics. There will be sound reasons for those particular standards.

What is important from a procurement perspective is that we continue to develop a system that is not only open and transparent but that allows opportunities for continued engagement with suppliers. We look at the other broader levers that we have to support suppliers in meeting the requirements and demands of public sector procurers.

We look forward to the proposed community wealth building legislation, on which we have engaged closely with the FSB, increasing opportunities for local suppliers and SMEs. That will be crucial to the success of our approach.

There is a fundamental point about knowing what need the procurement is seeking to address. With regard to commissioning, we must ensure through pre-market engagement with suppliers that they have a clear understanding of the need and demand that is to be met. On the point about the officers who are involved in the administrative process of drafting and decision making, that will be for the individual contracting bodies, but they must comply with the legislative requirements. They have to be in a position to demonstrate how they are doing that. I know that those points have been raised in previous sessions, but there is a fundamental point about having a clear understanding of the need and demand and about working with suppliers to find the most effective way of addressing that.

The first point is implicit in what Mr Stewart stated and echoes the points that were made earlier about East Ayrshire. That example demonstrates what is possible under the existing legislative framework, which permits the kind of activity that he has described.

On the question of why other public bodies and other contracting authorities do not take a similar approach, that will, ultimately, reflect the decisions that they have taken. As I touched on earlier, local authorities are, of course, democratically accountable to their electorate.

I will not re-rehearse the points that have been made about the various examples of facilitating and sharing best practice—whether in person or online—but, with regard to how we can further support public bodies to share best practice beyond what we have already set out, I will, of course, carefully consider the committee’s views and reflections on the matter. This is a statement of the obvious, but the key point is that the examples of good practice that have been identified are occurring under the existing framework, so they demonstrate what is possible.

I do not know whether Graeme Cook has any reflections on the broader point about sharing best practice and whether he can unpack why some authorities will take one approach while others might not choose to take the same approach.

Good morning. Thank you very much for the invitation to appear before you this morning.

It seems to be clear that there is agreement on the importance of public procurement in Scotland and the role that public procurement plays in delivering sustainable economic growth, as well as on the big steps that have already been taken to improve the way in which the public sector buys goods, works and services.

The 2014 act was intended to be powerful and proportionate and to place sustainability and wellbeing at the heart of procurement activity. It places on public bodies a small number of general duties and some specific measures that are aimed at promoting good, transparent and consistent practice. It has led to a range of measures to make procurement opportunities more accessible to small and medium-sized enterprises, third sector bodies and supported businesses. Those include advertising opportunities through Public Contracts Scotland, dividing contracts into lots, subcontracting opportunities through the supply chain and supplier development activities.

We deliberately built on the legislative framework and developed business-friendly and easy-to-access training, guidance and support for businesses of all sizes. The results are demonstrated through the Scottish ministers’ “Annual Report on Procurement Activity in Scotland”, which we published this week. For example, 56 per cent of the £16 billion of Scottish public sector procurement spend went to Scottish businesses and 55 per cent went to Scottish SMEs, which provided £7.5 billion to Scottish gross domestic product along with 130,000 full-time equivalent jobs.

We actively undertake research and engagement and seek feedback from industry, the public sector, third sector and supported businesses to test and inform our approach. We do that through surveys, commissioning research, our public supply group, industry representation, and hosting supplier round tables. The findings from that research underpin Scotland’s public procurement strategy, which was developed across the sectors and with industry, and was published in April last year and is a first in providing a high-level vision for Scottish public procurement.

It was reassuring to hear those who gave evidence to the committee talk in favourable terms about the changes that have been introduced by the legislation. The 2014 act is critical in underpinning an approach to public procurement that helps to create opportunity, boost inclusive and sustainable economic wellbeing, tackle inequalities and create real social impact.

The journey, however, is not complete. We will always look at what more we can do to maximise the impact of public procurement in Scotland. With that in mind, I welcome the committee’s post-legislative review of the 2014 act.

I am more than happy to do that. I recognise that that is one of a number of areas in which there will always be tensions, because tensions always exist in procurement. With your permission, convener, I will bring in Nikki Archer to say a few words.