As part of Social Enterprise Reset Week, Yvonne McBride, P4P Manager, discusses what procurement and collaboration could look like for social enterprises and enterprising third sector organisations in a post COVID-19 future.
The strength of the third sector delivering critical joined up support and local services during the COVID-19 pandemic has made me think what will income-generation for the sector look like once we emerge from this current crisis and what positive ways of working will we retain.
Partnership for Procurement (P4P) is fully funded under the Scottish Government’s Social Enterprise Strategy and Action Plan, to deliver capacity building support to the third sector (particularly to smaller third sector organisations), to develop collaboration and consortia to bid in for (and hopefully win!) a bigger share of Scotland’s £11bn procurement spend.
But with public sector buyers having to make decisions quickly, focus less on price in getting vital services to some of the most vulnerable in our society fast; what are the trade-offs that are having to be made around procurement and what will this look like for the sector when it’s all over?
We know that around 76% of overall procurement notices are published using the (Public Contract Scotland), PCS ‘Quick Quote’ system. Services under 50K can be purchased by going out to suppliers who have registered their details and set up on this system and are, therefore visible to buyers, to invite them to submit a tender.
Here’s the rub! Most small third sector organisations will not be familiar with PCS, Quick Quotes or the procurement lingo, which is why P4P was set up in the first place and funded to directly support the sector to work towards a level playing field. We would suggest that there is an urgent and increased need to support small third sector organisations to become better prepared for procurement, take advantage of these opportunities and be tender-ready in order for the sector to move swiftly beyond the current crisis. Ensuring that income from public sector procurement spend is an increased part of the income to the sector in the future
Under the Ayrshire Growth Deal, North Ayrshire has ambition to establish North Ayrshire as Scotland’s first Community Wealth Building (CWB) Council. In developing their strategy for CWB, North Ayrshire has identified ‘procurement’ as one of the 5 pillars for their CWB approach. They will look to harness the power of procurement as an economic development tool to help local businesses secure contracts and in turn boost the local economy through creating local jobs, business start-up and growth. Based on the ‘Preston model’ the development of this approach in Scotland is timely given the current crisis.
P4P works alongside dedicated business support, such as Just Enterprise and other intermediary support organisations so that the sector can work towards sustainability and reduce grant dependency (where appropriate) longer term. The need for targeted capacity building and business support for the sector has become heightened during this crisis, with income from trading being badly affected. This need will be even greater moving forward to serve new markets, innovate and deliver vibrant local economies.
To Tender or Not to Tender – that is the question?
A recent article, from Annie Gunner Logan (Director of CCPS – the Coalition of Care and Support Providers in Scotland) on what third sector care and support might look like advocates against tendering for social care, saying “… the commissioning and procurement system that has been developed over the last two decades is based almost entirely on the premise that providing care and support to people who need it is nothing more, in effect, than a business opportunity.”
Public sector early stage commissioning process (as part of the procurement process) allows for meaningful engagement with services users and the market to inform whether an identified service gap should go out to tender. I’m wondering now if this stage is even more crucial in consideration of how we can make better use of the third sector markets (and stimulate new markets where we have gaps), to support local job creation for some of our most disadvantaged residents. This is surely sustainable procurement and community benefits in action – no?
The Scottish Government has responded to the COVID-19 crisis and its effects with, a raft of grant funding and targeted business support, which has now been put in place to ensure that the sector is provided with much needed funds to ‘weather the storm’, deliver services quickly or to pivot services in response to current COVID-19 restrictions such as social distancing. This is welcome and the information gained from the sector through the application process should be used to further inform future government funding and how resources can get to the front line quickly.
We have been reminded during this time that it is not just procurement spend which can deliver a ‘quick and lawful outcome’. On launching the fund, Aileen Campbell (MSP) Cabinet Secretary for Communities and Local Government, said the funding “….will be focused on delivery, not bureaucracy or red tape”. Hallelujah! And as an aside might we continue the use of positive language when referring to the sector and go back to using words like ‘diversity’ and ‘vibrant’ when this is all over?
Equally as encouraging for the sector is the message coming from Scottish Government procurement, in guidance to buyers and suppliers, which includes awareness and handling of procurement related issues and the need to procure goods, services and works with extreme urgency; options for payments to suppliers to ensure continuity and practical steps that buyers can take to make best use of resources during the Covid-19 outbreak. For more information check out the Scottish Government guidance highlighted in the SPPN 2020.
During the last couple of months, the number of contracts advertised on the PCS portal has gone down. This could be as a result of buyers holding back on non- urgent purchases and delaying contract notices, purchasing from existing frameworks and/or making direct awards where justified.
We know from our sector partners that some contracts have been pulled, leaving an already fragile sector, serving some of the most vulnerable of our communities scrambling for grant funding in an attempt to see them through this period. It is apparent that some suppliers will have furloughed staff, reduced or ceased trading or repurposed their offering in response to the crisis.
Alongside this a number of new partnerships and collaborations have developed. When the current crisis is over, many of the ‘new ways’ of working and partnerships which have been developed will prove vital for our economic recovery. P4P has developed a Collaboration During a Crisis Guide which walks organisations through considering and developing consortia during a crisis such as this and we are here to support enterprising third sector organisations along their collaboration journey.
Looking to the Future
Part of the challenge for buyers is how to engage with the sector and to be able to do this quickly. Intermediary organisations such as the local Third Sector Interfaces and Social Enterprise Networks alongside sector intermediaries (in for example financial inclusion and housing etc.) have played a key role in coordinating responses to funding, cascading information and brokering connections between the public and third sector and local communities. Aileen Campbell (Cabinet Secretary for Communities and Local Government) says “Local authorities, local businesses, community groups and the third sector know and understand the support needs of their communities the best.”
Transparency and integrity are essential in procurement and it is even more important than ever that public sector buyers and third sector suppliers meaningfully engage to innovate and come up with solutions to get us through this crisis and shape how we deliver services moving forward. We welcome the strength of partnership working and new collaborations which have been developed. This is a real strength of the sector and the current crisis has made consortia working all the more acute in recent months.
It is right that third sector organisations should be encouraged to register their details on PCS and capacity building support is available to make this happen. This is a crucial first step to ensure that (if they so wish) they too can potentially get a share of that £11bn public sector procurement spend.
The third sector delivers across most (if not all) of the public sector policy areas and over the last few months have demonstrated a strength in partnership working. Future government policy and funding cannot lose sight of the opportunities for community anchor organisations, social enterprises, supported business and the wider third sector to continue to work in partnership with the public sector to reduce poverty, inequality and environmental impact beyond COVID-19.