Procurement: annual report 2022 to 2023

1. Introduction

1.1 Background

This report provides an overview of Scottish Government procurement activity during the period 1st April 2022 to 31st March 2023. It reflects our performance as a contracting authority and includes reference to some of the broader activities we undertake in leading and delivering procurement policy, capability and systems across the Scottish public sector.

The report is prepared in accordance with the requirements set out in the Procurement Reform (Scotland) Act 2014 which forms part of the public procurement legislation that governs how Scottish public bodies buy their goods, services and works.

We work together with the public, private and third sectors to deliver maximum value through public procurement activity. This report focuses specifically on Scottish Government core activity and national collaborative contracts and frameworks, as well as our procurement policy function, and our eProcurement and best practice function.

We buy for the wider public sector in Scotland and provide procurement support to Scottish Government agencies and Non-Departmental Public Bodies (NDPBs). Our contracting activity covers four main areas (below).

• Scottish Government (SG) core contracts: for Scottish Government use only.
• Central Government Agencies and NDPBs: non-collaborative contracts placed on behalf of individual public bodies in the Scottish central government family.
• Sectoral collaborative frameworks: let by Scottish Government for use across the central government family of organisations including agencies and NDPBs.
• National collaborative contracts/ frameworks: provide framework agreements and contracts for commonly purchased goods, services, utilities and works which are used across the public sector.

1.2 The Public Procurement Strategy for Scotland

'Putting public procurement at the heart of a sustainable economy to maximise value for the people of Scotland.'

In the reporting year, the first ever Public Procurement Strategy for Scotland was developed by a cross-sectorial working group with representatives from each sector, led by the Scottish Government.

The intention behind developing a national public procurement strategy was to provide a future high-level vision across all of our public sector bodies, that everyone could align to and deliver against. The working group undertook discovery work to look at what all sectors were doing at that time, what other public and private sector organisations were doing, and what other internationally comparable countries and states were doing.

There was considerable engagement with key stakeholders to help shape the iteratively developed strategy. These engagements took place through one to one meetings, Procurement Supply Group (PSG) meetings, roundtables and survey responses. Impact assessments were also prepared to ensure that the strategy included consideration of how it could create positive effects. This all fed into the final draft which was accepted by ministers and the Public Procurement Group (PPG) ahead of publication.

The new objectives in the strategy replace the previous public procurement priorities and put them in the context of the vision that the strategy sets out for Scotland.

Official publication of the Strategy took place in April 2023, just after the end of this reporting period; however, this report aligns to the content of the Strategy as it sets the vision for all public sector bodies.

Supporting this, the contents of this report (and the Public Procurement Strategy) are structured around our Procurement Outcomes, which are outlined by the Sustainable Procurement Duty, which requires us to buy in a way that is:

• Good for businesses and their employees
• Good for society
• Good for places and communities
• Open and connected.

These outcomes underpin and enable our work.

Annually, we review our Procurement Strategy to make sure it remains relevant and fit for purpose.

1.3 Methodology

This report draws on Scottish Government data and management information (MI) as well as two other primary sources:

• Public Contracts Scotland portal

The Public Contracts Scotland (PCS) service provides a national advertising portal for Scottish public bodies to post contract opportunities and contract award notices; prime contractors on public sector contracts can also advertise sub-contract opportunities. It is mandatory for all Scottish public sector organisations to use PCS to advertise all regulated procurements (£50,000 and over for goods/services; £2 million and over for works) and their subsequent awards; in addition, many organisations use PCS for direct requests for quotations (Quick Quotes), for lower-value, unregulated procurements.

• Scottish Procurement Information Hub

Public procurement spend data is available through the Scottish Procurement Information Hub ('the Hub'). Each year, raw accounts payable data is requested from bodies across the Scottish public sector. This data is enhanced by a third-party supplier using publicly available data in order to classify suppliers by size, location, area of business, charity status and other characteristics, before it is uploaded to the Hub, where it is made available to participating public bodies for analysis.^[1]

• Spend data

Where data on total spend with all SMEs is reported (UK-wide), this is based on total size of organisations being known. For total spend in Scotland, this is based on postcode of organisations being known. Scottish SME spend is based on size and postcode being known.

Where relevant, information is supplemented by evidence from other sources and from other research carried out by the Scottish Government during the year.

It is important to avoid making direct comparisons between data from different sources, owing to the considerable differences in the scope and data collection methods that apply to each source. As such, the sources have not been used to draw any direct comparisons but, rather, they have been combined to provide a comprehensive overview of Scottish Government procurement activity in 2022-23.