Are you wondering what happens to procurement activities during purdah? Proxima explains what the pre-election restrictions mean for Government Commerical
First Brexit, and now pre-election embargo – ‘purdah’ by another name. If you’re a private sector organisation trying to win public sector business, you would be forgiven for thinking that central government’s commercial wheels are turning even slower than normal.
The public sector is not known for pace in commercial decision making, arguably for good reason. There are significant complexities involved in procuring what Government needs, not to mention bureaucracy designed to minimise risk, while leveraging significant aggregation opportunities to deliver value for money benefits for the tax payer.
The uniqueness of 2019 in political terms has only exacerbated the time to make decisions – surrounded by uncertainty, officials have found it difficult to prioritise and deliver at a time when their environment is in a constant state of flux.
Why is purdah important?
The election guidelines for 2019 make this reference to commercial activity (published 4th November 2019):
“It is customary for Ministers to observe discretion in initiating any action of a continuing or long term character. Decisions on matters of policy, and other issues such as large and/or contentious commercial contracts, on which a new government might be expected to want the opportunity to take a different view from the present government, should be postponed until after the election, provided that such postponement would not be detrimental to the national interest or wasteful of public money.”
Essentially, Departments and NDPBs should avoid taking any irreversible decisions (for example, awarding significant or material commercial contracts) which may frustrate the strategic or policy objectives of a new Government.
Simple, right?
Wrong. The key challenge is in how to interpret of these guidelines. For some, perhaps the larger and more commercially mature departments, they will do some analysis (if they have not already) about which of their key programmes and commercial procurements and associated activities fall into this camp. It will therefore be reasonably clear which ones will be disrupted or delayed by the election. Others will be unaffected, able to progress as they were – to continue to deliver value for money to the public purse, even at a time of great uncertainty.
For other Departments and NDPBs it may not be at all clear (or rather, they may not have the resources to complete the appropriate analysis) which programmes and commercial activities are affected. In this case, all procurement and commercial activity may be put on hold.
What is the direct impact of purdah in 2019?
For a supplier to the public sector business, such paralysis can be tricky.
Procurements which were being developed have been put on hold. It’s likely they may be reinvigorated… but this will probably be after the Christmas period – a notoriously quiet time for public sector, especially central government. Procurements already released into the market have been cancelled, with no view as to when they might reappear. As for the Crown Marketplace, well, never mind the Crown Marketplace.
The direct impact for an SME organisation is on resource (and reassignment of it), forecasting and revenue pipelines. Whilst these are critical considerations for any business, regardless of size they are magnified for SME’s or businesses with an over dependence on one service of customer grouping.
'Add into the mix that Brexit may happen by 31st March 2020... Does purdah add yet another complexity to the “leave” timetable?'
For public sector officers, it’s likely to be a time of huge frustration, too.
As commercial professional specifically, you have objectives – perhaps even value for money targets – to achieve, as well as a sense of public service. Not only will delays affect your ability to deliver to your internal customers (and in turn, the public) but they may also affect the results you can actually achieve.
Add into the mix that Brexit may happen by 31st March 2020, and some procurement activity which may ordinarily have been concluded prior to that date, may now not be finished in time to avoid likely price and currency fluctuations. Does purdah add yet another complexity to the “leave” timetable?
How can the market help?
The ‘market’ has A LOT to say on Brexit. Everywhere you look there are articles designed to give advice on how to prepare (for whatever outcome), what to consider, and how to manage uncertainty.
Purdah however is a different story. As Civil Servants hunker down to prepare for the election (in whatever way their Department deems suitable and allowable), the commercial engagement space is a desert. Pre-market engagement has disappeared and officials’ attention is diverted to what may (or may) not happen next.
Where the market can continue to help is in supporting Departments, through immediate capacity and capability improvements as they turn the attention to other challenges within their organisations. These public sector commercial challenges will outlast pre-election embargos, an election, a potential change in Government…and even Brexit.
Proxima's report - The Capability Conundrum: Resourcing Challenges in Government Commerial - can be read here.
Or further article insights are available on CSW here.