1. 1 Introduction to Procurement Scotland and the Public Procurement Reform Programme Nikki Bell Procurement Scotland Deputy Director PLEASE NOTE: Slides 21, 22 and 23 have been updated to take account of feedback received on the day of the presentation

2. 2 Procurement Reform Programme Update National Programme Workstreams Procurement Scotland Overview Accessibility of Contracts Collaborative Procurement Process Overview AGENDA

3. 3 Public Sector Procurement Vision Category A Category B Category C1 National Strategies & Contracts: Goods or services of a similar standard or nature Where a single interface with the public sector facilitates efficiency and competitiveness of suppliers. E.g. IT HW, Telecoms, Office Equipment & Supplies Sector Specific Strategies & Contracts: commodities and Services that tend to be unique to a specific sector, yet common within that sector General Strategies & Contracts: Commodities not categorised as A or B. Establishment of contracts will be conducted as the remit of a single organisation. e.g. niche IT applications. Where interface coordinated via a sector CoE. E.g. Wheelie bins, Medical Equipment, Care Services Commodities & Services categorised as A, B or C Category C Where interface coordinated via regional hub or local organisation Local/Regional Strategies & Contracts: where it is appropriate to consolidate requirements on local/ regional basis

4. 4 Public Procurement Reform Programme Cat A – National Contracts Cat C – Local Contracts Cat B – Sectoral Contracts Reform Programme Reform Programme People & Skills Manage- ment Information Best Practice Policy & Guidance Competitive Supply Base e-Tools Health Boards Central Government Local Authorities Fire & Rescue Services Police Services Universities & Colleges NHS National Procurement Fire Scotland Excel APUC CGCoPE Police

5. 5 Overview of Governance Model Programme National Procurement CoE Sector Specific CoE End User Organisation Proc. Ref Del. Group Public Procurement Reform Board Public Procurement Advisory Group (PPAG)

6. 6 Recognition of Challenges / Major Change Programme Evolving governance Organisations at different stages of development New terminologies / ways of working Resource constraints, changing roles & expectations Increasing scrutiny Need to parallel process ‘set up/development’ with ‘delivery’ Ensuring appropriate engagement and communications in complex stakeholder environment => Managing full change spectrum

7. 7 Key Enablers & Critical Success Factors Ministerial endorsement & direct support High level sponsorship Increased visibility/expectations of procurement & its contribution Common vision & approach Key enabling platforms! (MI, toolkit, collaborative tools/systems) Agreed ways of working/protocols & stakeholders willingness to engage & interact constructively.

8. 8 We have developed several key tools to steer a course through this challenging landscape Standardised advice on best practice including latest policy/guides/support regarding corporate social responsibilities; Visibility of current spending behaviours with detailed analysis of spend by supplier, commodity, invoice value, public sector organisation, sector, etc; A standard system to measure improvements in performance over time; Access to a National contracts register & advertising portal (One stop shop for suppliers. Facilitates ‘adequate publicity’ of tender opportunities); Advice, guidance and templates to help reduce the burden on suppliers (How to we reduce barriers to competition and ensure a level playing field, fairness, transparency?); Access to tools, latest thinking & events to support people and skills developments (Where and how can we increase our procurement skills?).

9. 9 CoE Role To deliver collaborative national/sector procurement strategies & contracts that deliver best value for Scotland/sector –cost and efficiency savings balanced with CSR responsibilities To enable and drive procurement capability & expertise To facilitate and drive best practice: –Adherence to Legal, EU & Policy –Benchmarked & Consistent Strategic Procurement Processes (Toolkit) –Responsible Procurement –Process Efficiency & eEnablement –Performance Management –Supplier Engagement / SRM / Supply Chain Management

10. 10 Procurement Scotland Officially launched March 2008: Our Vision: “To contribute benefits to the people of Scotland through the development of efficient and effective national procurement strategies.” Our Aim: “We will deliver Value for Money Savings through the implementation of innovative, fit-for-purpose Category A procurement strategies and contracts focused on optimising and balancing total cost of ownership and sustainability drivers.”

11. 11 Procurement Scotland ‘In–scope’ Category A’s include: IT Hardware IT Software Telecoms Professional Services (Including IT Consultancy) Office Equipment – MFDs Corporate Services - Office Supplies, Postal Services Utilities - national contracts from 2009/10 Public Sector spend (Goods & Services) ~ £8bn Category A ~ £1bn

12. 12 Progress at 3 rd November‘08 - Procurement Scotland Recruiting and inducting team to become fully operational; Establishing/championing governance, ways of working, systems & processes to enable collaborative procurement across Scotland; Leading innovation on best practice specific to balancing sustainability agenda in support of Scottish Government’s wider agenda –E.g. economic, social, environmental, total cost and risk factors; Leading national people and skills work stream to ‘nurture the talent’ which already exists within Procurement across the Scottish Public Sector; Delivering commodity strategies against agreed milestones: –securing and generating cashable and non cashable savings ahead of targeted savings, –Optimising service levels, innovation, quality and process efficiencies.

13. 13 Progress at 3 rd November‘08 - Procurement Scotland IT Hardware e-auction secured £5.45m savings (and growing); Office Supplies framework secured potential annual savings of £7.6m; Out to market for Scottish public sector demand on Electricity and Multifunctional Devices; Category plans, sourcing strategies and stakeholder engagement well underway for Telecoms, IT Software, Gas, Interim Management…. Market analysis and opportunities assessments underway for postal services, couriers, fuel, travel services…. Going to market for Professional Services imminently. For status/updates refer to: http://www.procurement.scotland.gov.ukhttp://www.procurement.scotland.gov.uk

14. 14 Accessibility to Contracts All Procurement Scotland contracts advertised to ensure that the Scottish Public Sector has access. The Scottish Public Sector will be fully defined in the tender advert but does include: Police Fire NHS Local Authorities Central Government (Core departments, Agencies and NDPB’s) Higher and Further Education

15. 15 Governance & Ways of Working Collaborative Procurement Process Graeme Cook Professional Service Category Manager graeme.cook@scotland.gsi.gov.uk

16. 16 National Category Forums (NCFs) Cross-sectoral advisory groups; Bring particular expertise in the goods or services in scope for Cat A procurement; Drawn from cross-sectoral procurement staff and technical from end-user organisations and Centres of Expertise; Role? To ensure pragmatic procurement strategies are developed and deployed that deliver best value; To represent support, lead and facilitate communications with the wider the stakeholder community across their sectors. Who?

17. 17 National Category Forums (NCFs) Main tasks? Engaging proactively with their respective sector: Representing sectoral views at the Forum Updating on progress of Category A procurement activity Leading User Intelligence Groups (UIGs) within their sectors as appropriate; Participating in opportunity analysis exercises; Contributing to, and endorsing, category strategy development proposals to ensure ongoing best value procurement; Contributing to, and endorsing, proposals on specifications and standards; Supporting and championing wider stakeholder engagement via UIGs or workshops; Participating in tender evaluation/supplier selection & ongoing supplier management & development.

18. 18 Maximised leverage, learnings and engagement opportunities including: Other UK wide reports, tenders, guidance and experiences Market engagement REC engagement User engagement (workshops, one-to-one meetings etc) Professional Services – Approach

19. 19 Holistic portfolio approach across broad spectrum of external resource categories including: Temp & Interim Interim Specialist Interim Management Consultancy Focus not just on frameworks but under pinned by governance, guidance and toolkits to support demand management and best practice Championed at highest level. Professional Services – Approach Consultancy Firms Employment Agencies Interim Management Agencies Consultancy Interim Management Temp & Agency Interim Specialist

20. 20 Contract Overview & Scope Areas Covered by these agreements Therefore for these agreements we define Temporary staff to include administrative, manual industrial and cleaning, IT, social & care catering and trades. Areas Not Covered by this Contract Permanent Recruitment Clinical Temporary Workers

21. 21 Framework Agreements Lotting Strategy Administrative Dumfries and Galloway Interim Management IT Interim Specialist Social / Care Catering Frameworks 1, 2 and 3 will have up to 8 regional lots (as demonstrated below, using the Administrative framework as an example). Subject to the capacity of successful bidders, we envisage that each regional lot will support a single supplier. However, bidders must note that if no one supplier can demonstrate the required volume capacity (to the satisfaction of the evaluation team), 3 or more suppliers will be invited to participate in that lot. Additional bids on combined lots for regions with small spend will be sought in the tender. Central Manual, Industrial & Cleaning FifeGrampian Lothian and Borders NorthernStrathclydeTayside Framework Title Regions One Supplier per Region 12 4 35678 One-Stop Shop

22. 22 Framework Agreements Lotting Strategy– Lots (cont’d) Dumfries and Galloway CentralFifeGrampian Lothian and Borders NorthernStrathclydeTayside Framework Title Regions Several Suppliers per Region Lotting Strategy Frameworks 4 and 5 will have regional lots, each supporting several suppliers (as demonstrated below, using the Catering framework as an example). Actual numbers will be determined by the volume capacity of suppliers successful at the PQQ stage. Additional bids on combined lots for regions with small spend will be sought in the tender Administrative Interim Management IT Interim Specialist Social / Care Catering Manual, Industrial & Cleaning 12 4 35678 One-Stop Shop

23. 23 Lotting Strategy Frameworks 6, 7 and 8 will be national for Scotland (no regions) with several suppliers. Business will be awarded through mini-competition. Framework Agreements Lotting Strategy – Lots (cont’d) Administrative Interim Management IT Interim Specialist Social / Care Catering Manual, Industrial & Cleaning 12 4 35678 One-Stop Shop Framework Title

24. 24 Post-code Spend Analysis by Lot

25. 25 Post-code Spend Analysis by Lot Spend is annual spend based on data from the Hub which is currently a mix of 05/06 and 06/07 data

26. 26 Make every effort to answer the question in the space given. Do not refer to marketing materials or attachments. No prior knowledge Evaluation teams for subsets of questions – don’t refer to the “answer above” (it’s OK to repeat yourself) Read and re-read the question Only use the comments fields if absolutely necessary to add clarity to an answer Consortia bids are welcome (identify the lead contractor clearly) Alternatives to audited accounts are welcome and will be evaluated Bid with your best bid FIRST TIME. Do not expect to enter into post-tender negotiations. Understand the Reform and Political environment and drivers. Expectations in PQQ and ITT (Don’t forget the basics!)

27. 27 Status: Strategy Development Nov - DecJan - Feb <<August (July) Approve Commodity Plan March 2009 (End Oct) Approve Strategy May 2009 >> (Nov) Publish OJEU & Release PQQ (June/July) Contract Go-Live (Jan) Issue Tender (Mar) Receipt of Tender (May/June) Pre-award Decision Timelines

28. 28 Break

29. 29 Q & A