Tag Archives: public procurement

Both Peter Black and Lord Bonkers have referred to the problems of public procurement. It is a major problem and one that would have had our Victorian and Edwardian ancestors scratching their heads in bewilderment. Whenever they wanted to build say a railway, they would get an Act of Parliament passed authorising all the necessary work, the finance and land acquisition, appoint contractors and get on with it. This didn’t only apply to new undertakings. A recent TV documentary based round Leeds told us that a local building contractor was appointed to sort out the land and tracks round Leeds Station in the late 1800’s devastated by a fire in Dark Arches. The contractor gathered a huge workforce and had the railway back in business in 6 days. Can you imagine that ever happening today? Yet, when I was young, British Rail often got railways running again in a few days, even after serious crashes.

Just look at the mess surrounding major projects, like CalMac’s new ferries, HS2, Midland Mainline electrification and many more. Constant delays, huge price rises, cancellations. Why is this happening and why do both the UK and Scottish governments accept huge price rises often amounting to a doubling of the price?

Here a comparison with the private sector is apt. If someone wants a house/houses built or if a business wants new offices or a factory, professionals are employed to get the necessary permissions, raise the finance and employ a contractor to do the job. A price and timetable are agreed with the contractor and very often there are penalty clauses for not completing on time and to budget. If a contractor doesn’t do the sums right, then that’s their problem. They can’t, usually, go back and ask for more money. When I was in the USA in the early 70s, motorways had to be resurfaced overnight and there were huge penalties if they were not completed on time. Where is that sort of operation in the UK today?

Yet, somehow, with public contracts, this doesn’t apply. Contractors seem to have carte blanche to announce delays and demand more money, presumably on the basis that it’s only the state and their funds are bottomless. Why are contractors for public projects not held to the same rules as those working in the private sector?