My Lords, I rise to speak to Amendment 81, which we on these Benches regard as particularly important. It would put in the Bill one of the most important decisions to take before embarking on the procurement of public goods and services: make or buy? That is the subject of an entire chapter in the Government’s own Sourcing Playbook. This key decision process is missing from the Bill. We seek to put it in as an essential part of the pre-procurement process. The choice of delivery models
should be based on careful and impartial consideration of the different forms of delivery available for each type of work, supply or service.
Conservatives in Government have sometimes acted as though outsourcing to for-profit companies—often large outsourcing companies that have been labelled “strategic suppliers”—is the only model worth considering. Unless the Minister wishes to argue that The Sourcing Playbook and other recent publications on procurement guidelines are no longer operable, it seems entirely appropriate to put in the Bill that the choice between in-house and outsource should first be considered. Later, we will move other amendments on the delivery model choices between for-profit and not-for-profit provision.
We have carefully followed the Government’s own language in these publications in drafting the amendment. The Minister may argue that we should leave the Bill a skeleton as far as possible to allow Ministers as much flexibility as possible; we have heard him press the case for flexibility already. We argue the case for clarity, accountability and future-proofing. The principles of the procurement process must be in the Bill, not left for later in the policy statements issued by changing Ministers as they pass through the relevant office.
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The UK has now had 40 years’ experience of outsourced procurement of public services. Some provision has been a clear improvement, at lower cost and higher quality; some has failed to make very much difference from earlier public provision, either in quality or in cost; some has failed to provide what was promised; and some has cost a good deal more than in-house provision would have done.
When in government, I was a strong proponent of the Government Digital Service. Others in Whitehall resisted this Cabinet Office intrusion into departmental digitalisation and ended up instead paying enormous sums to consultancies and outside contractors for what turned out to be poor outcomes. We are all aware of the weaknesses of the outsourced model adopted for the rail network, now being brought partly back in-house. We watched the water companies transfer substantial dividends to their largely overseas owners while failing to provide the additional investment in the sector that privatisation was intended to stimulate. And, as we will argue in later amendments, there are sectors in which private, for-profit provision seems almost entirely inappropriate: social care, care homes, probation and children’s services.
The wilder and more ideological members of this Government—Mr Rees-Mogg, for instance—would happily slash the Civil Service and employ outside consultants at much higher rates instead. There have been times when the relationship between the large outsourcing companies and this Government have looked too cosy and too close, without sufficiently critical assessments from within Whitehall of the overall value for money of alternative forms of delivery.
This amendment would put into the Bill, as an essential stage in the preliminary steps to contracting for public services, consideration of the whole-life cost of procurement—in-house, outsourced or some form
of mixed-economy model. I hope the Minister will accept it as something that would guide a future Government, of any complexion, and which should be included in the Bill.