Cardiff Dissemination Workshop 28th March 2007
1.0 INTRODUCTION
The Sustainable Development Research Centre (SDRC) is the research partner to the Benefiting the Economy and Society Through (BEST) Procurement programme, which is part funded by the European Social Fund under the Equal Community Initiative Programme. Action three of the programme is to disseminate the research undertaken through a series of dissemination workshops in each region of England, one in Scotland and one in Wales. Each of these will discuss one of five themes: Agents for Change; Health Markets and Social Enterprise Development; Influencing the Demand Side; Resource Capacity and Future Social Enterprise Development and Business Effectiveness. Each workshop will bring together BEST Procurement programme development partners and local people involved in the supply and demand sides - providing a forum for them to discuss their experiences with social enterprises and procurement.
2.0 THE CARDIFF DISSEMINATION WORKSHOP
The first workshop was held on the 28th March 2007 at the Wales Millennium Centre, Cardiff. The theme for the workshop was ‘Agents for Change’. Delegates at the workshop included representatives from SDRC and various sections of the public sector, including regional and local government. There was also representation from the voluntary sector and the development trusts association.
The workshop consisted of two main sections – the first comprising a series of presentations looking at the demand side from the perspective of the BEST Procurement Programme in the East Midlands as well as a Welsh perspective. The second part of the workshop comprised an open discussion involving all participants that discussed the theme: Agents for Change – the Public Sector and Social Enterprise.
3.0 ISSUES RAISED – AGENTS OF CHANGE AND TYPES OF CHANGE
Issues on agents for change emerged from both the presentations and the discussion sections of the workshops. However, the discussions focused mainly on demand side (public sector) procurement issues. This may be partly due to the composition of the delegates (skewed towards the public sector).
3.1 AGENTS FOR CHANGE – LOCAL AUTHORITIES
There were representatives from the demand side (public sector) at the workshop from both Welsh and non-Welsh organisations. However, there were similarities in the issues raised by them in relation to the role of local authorities as ‘agents for change’.
The development of websites on which to advertise contracts was discussed as one way for local authorities to open up the tendering process to social enterprises. Also pointed out as good practice was the development of websites through which organisations looking to supply to the public sector can inform local authorities about what they are able to supply. It was also noted that having an on-line guide to procurement practices can help organisations interested in tendering for public sector contracts.
It was pointed out that there are several other ways in which local authorities already act as agents for change in relation to making procurement more accessible, particularly to social enterprise. It was reported that some local authorities produce guides to procurement and hold sustainable procurement workshops and seminars. This was seen as an effective means of acting as an agent for change. It was also pointed out that local authorities can (and do) provide writing training and have provided crash courses for social enterprises.
‘SME Engage’ in Wales was pointed out as a way in which local government has enabled smaller organisations to compete for contracts. Schemes such as these could be extended to involve the third sector and social enterprise. It was also pointed out that within Wales, the Local Supplier Development Project (for SMEs and the third sector) was designed to help such organisations tender to both the public and private sectors.
3.2 TYPES OF CHANGE – CHANGING TENDER SPECIFICATIONS AND PROCESSES
There was much discussion concerning the need for tending processes to be more accessible to social enterprises. Changes to tender specifications on the part of local authorities were raised as one particular type of change. One of the main issues raised in relation to this point was that local authorities need legal advice regarding how they can adapt tender specifications in order to incorporate sustainable procurement. This is because local authorities want to try and factor into tender specifications the social and community benefits that social enterprises can bring, but still be fair and open and not discriminate against other organisations. Therefore, there is a need for professional legal advice for procurement officers for what can legally be included and evaluated in tenders.
It was pointed out that local authorities look for best value when awarding contracts. Therefore in order for social enterprises to win contracts, a way needs to be found for them to demonstrate that they have added value. The driver behind this attitude is the need for the public sector to demonstrate efficiency savings. These mainly focus on cash savings or cost avoidance. Social enterprises may make wider benefits elsewhere but this is difficult to demonstrate in a savings report.
Large documentation was thought to deter organisations from tendering and, therefore, there is a need for a standard pre-qualification questionnaire that is easy to complete – possibly using a simple tick box method. A tick-box questionnaire would reduce organisational time for both social enterprises completing tenders and for the local authority receiving them.
Changes to tender specifications, therefore, could be an effective type of change to open up tendering processes to the social enterprise sector.
3.3 TYPES OF CHANGE – ALTERNATIVE FINANCE
It was raised that social enterprises should begin to consider alternative ways of financing their organisation. Private sector financing will look at social enterprises’ assets; therefore, social enterprises should begin to focus on increasing their assets. It was also suggested that the alternative investment market could be considered by social enterprises.
3.4 CHALLENGES FOR SOCIAL ENTERPRISES
The workshop also discussed the challenges for social enterprises in relation to bidding for, and winning, public sector contracts. Providing help to social enterprises in order for them to overcome these barriers was highlighted as a much needed type of change. For example, there is a need to help social enterprises submit professional tenders, and give them advice on the right ‘buttons’ to push by focusing on the right information. One suggestion to emerge from the workshop was for SMEs to give social enterprises advice on how to tender successfully.
It was pointed out that difficulties can be experienced by social enterprises regarding their managerial capacity and that this can hinder their ability to cope with changes especially those made within the local authority partner. Support could also be offered to social enterprises to deal with these issues.
3.5 CHANGING WORKING PRACTICES
It emerged from the workshop that local authorities and the police, ambulance and fire services are increasingly encouraged to undertake collaborative contracts. This means that the value of the contracts increases greatly and excludes the majority of social enterprises.
A possible change that could provide a solution to this is to encourage private companies awarded such contracts to sub-contract to social enterprises. It is uncertain at this moment in time to what extent this already occurs.
Another solution, proposed by local government as a possible way forward, is the development of consortia and collaboration between social enterprises. Leading on from this, however, it was raised that this could result in risk and trust issues – both between the social enterprises involved in the consortia and between the consortia and local authorities. It was debated as to what the level of support would be for such consortia forming and there was not a consensus as to whether such a measure would be successful.
3.6 FOSTERING COMMUNICATION
The need for greater communication was discussed throughout the session and focused on the fact that there needs to be greater communication between the local authorities and the other services, such as the police, so that developments in sustainable procurement can be shared. There is also a need for communication between these authorities and social enterprises. This would help social enterprises to understand the needs of local authorities and how they can meet these needs. It would also help the public sector to identify what local social enterprises can offer them. Therefore, it was felt that an identification of the goods and services that can be provided by the third sector/ social enterprises is needed.
4.0 CONCLUSIONS
This report summarises the main discussion points raised in a workshop that focused around the theme of: Agents for Change – the Public Sector and Social Enterprise. The workshop discussion focused around different agents for change, as well as different types of change that could encourage social enterprises to become involved with selling to the public sector.
It was shown that local authorities can act as agents for change by instigating various changes to help social enterprises become more involved with public sector procurement. Many instances of best practice were discussed including the use of websites to advertise contracts and foster communication between the public sector and social enterprises. Changing tender specifications and processes was a major type of change that could be instigated by local authorities. The instigation of support for social enterprises as a means of helping them tender for contracts was also highlighted as a much needed change. Changes to be facilitated within social enterprises themselves were also discussed – in particular the need to look towards alternative sources of finance and consider forming consortia.
