Procurement strategy: April 2021 to March 2023

3. How our procurement activity contributes to value for money

Procurement is a key enabler in delivering Scotland's Economic Strategy and contributing to sustainable and inclusive economic growth. We will continue to work together with the public, private and third sectors to deliver maximum value through public procurement activity.

Our involvement in public procurement is far broader than buying on behalf of Scottish Ministers. We also buy for the wider public sector in Scotland and provide procurement support to Scottish Government agencies and Non-Departmental Public Bodies (NDPBs). Our contracts deliver a wide range of economic, social and environmental benefits as well as significant financial savings for the public sector, which totalled £160 million in financial year 2019-2020, against an annual spend of £1.35 billion. Our contracting activity covers three main areas:

• Contracts for Scottish Government use only.
• Sectoral collaborative frameworks. These are let by the Scottish Government for use by the central government family of organisations which includes agencies and NDPBs.
• National collaborative frameworks and contracts. We provide framework agreements and contracts for commonly purchased goods and services which are used across the public sector.

Details of the contracts that we have placed can be found on PCS. More information about national and sectoral collaborative frameworks is included below.

Collaborative frameworks and contracts

Collaborative procurement is about achieving value for money for the Scottish public sector by working in partnership with buying organisations, the centres of expertise and suppliers. Our three established collaborative procurement portfolio teams cover Utilities, Information and Communication Technology and Corporate and Professional Services.

They award framework agreements for the whole of the Scottish public sector and for the central government sector. We also have a collaborative team that is developing a portfolio strategy for construction. The national contracts and frameworks awarded by our buying teams can be used by public organisations across Scotland and cover a range of goods and services. Details of our current Collaborative Agreements can be found on our website.

Forward plan of our collaborative contracts

We publish a forward plan of our national and central government sector collaborative opportunities along with those covering the health, higher education and local authority sectors in Scotland and which may be advertised over the next 12 to 18 months.

Scottish Government core contracts

Contracting for Scottish Government directorates is about delivering the services and goods required to enable government policy and support corporate functions. We place contracts that are key to delivering
the Programme for Government. Typically
we place around 200 contracts per year.
Examples of current and planned procurements include:

• Payments Platform;
• ISD (Information Systems Division) Delivery Partner for Maintenance and Modernisation of Rural Payments Systems;
• Energy Efficiency Scotland Programme;
• Scotland's Baby Box;
• Digital Evidence Sharing Capability Platform;
• Administration and Management of the Community and Renewable Energy Scheme (CARES);
• Climate Challenge Fund Management and Administration Services;
• Tech Scalers;
• IT (Information Technology) Managed Service for Level of Service (LS) Case Management Inventory (CMI) system, Community Justice;
• Centres of Specialist Expertise;
• Open Market Shared Equity Scheme;
• Equality and Human Rights Fund Manager;
• Farm Advisory Service.

Effective contract management is critical to delivering outcomes through procurement. We are using the national electronic contract management system to support our strategic contract management in Scottish Government. Also, we have developed and are mandating training for Contract Managers to build local understanding and commercial capability.

More Powers Procurement Implementation Team (MPIP)

The More Powers Procurement Implementation Team delivers contracts and provides commercial support to fulfil obligations under the Scotland Act 2016 which transferred a wide range of powers to Scottish Ministers, most significantly the powers over social security and employment support. Examples of procurement related activities include:

• Fair Start Scotland Employability Provision.
• Technology – IT Platforms and Support, Hosting, Testing, Telephony.
• Facilities – Estates, Accommodation, Furniture, Fleet.
• People – Advocacy, Recruitment, Interim Managers.

Value for money

In delivering the vision set out in the Programme for Government, we are working within a climate of uncertainty from the effects of, for example, COVID-19 and EU-Exit and ongoing budget constraint. It is vital therefore that buying organisations understand and mitigate risks and continue
to think commercially, spend wisely and deliver real value for money. We aim to achieve this by:

• working closely with the people who use the goods, services and works we buy to help understand their requirements;
• understanding the markets we work in;
• awarding contracts on the basis of fair, open and transparent competition which is in proportion to the contract in question and which keeps to our legal obligations; and
• making sure that our contracts are effective and managed efficiently.

Also, we removed the option in our Scottish procurement legislation for regulated contracts to be awarded on the basis of lowest cost or price only, recognising that value for money is rarely achieved by simply accepting the lowest-priced bid. We also encourage public sector organisations in Scotland to take part in the Procurement and Commercial Improvement Programme to help them to measure and improve their levels of procurement capability.