Tender Writing and why buy local initiatives have failed

Local purchasing initiatives are everywhere. Nearly every local authority has some commitment to buying from local suppliers where possible. It helps the local economy and ensures that local money stays in the area for the benefit of local people. The ambitions behind such initiatives are admirable, but last week’s news bears out the fact that in reality, local purchasing schemes do not and cannot work on a large scale, particularly in a struggling economy.

The news last week decried the failure of most local authorities to stand by their pledges to buy from local firms wherever possible through the tender process. The reasons behind this failure are relatively obvious.
Currently, and particularly in the current financial climate, local authorities are bound to approve the tender that proves most economically advantageous (MEAT). On the surface, this appears to be the cheapest, although the guidelines behind MEAT go deeper than just cost. Social and local factors can play a part in deciding MEAT in terms of number of local jobs created and improvements economically and socially to the local area. If when all is weighed up a non-local company still put forward the best tender then the authority is bound to choose it, to the detriment of ‘Buy Local’.

That’s not the only issue either. Strict EU rules on procuring by tender make it impossible for an authority to choose a supplier based on location alone. The process must be fair and equitable to all organisations that wish to write and submit a tender and to show obvious bias toward a local company, regardless of price and other benefits, clearly flouts those rules.
So whilst ‘Buy Local’ is desirable, unless local companies can write a tender which is viable and competitive alongside organisations from far and wide, there is no guarantee that they will win, regardless of whether their local authority has a buy local initiative running.

If local authorities cannot legally nor desirably choose a local supplier over more competitive national (or indeed multinational) companies, what then is the point of even announcing it? One reason is that European Public Procurement Regulations only apply to contract values over a certain threshold so authorities are free to not follow the regulations for whole of contract values under those amounts.
In some cases, Buy Local has worked. Hartlepool have placed a staggering 62% of their contracts with local companies in the past year and many other councils have shown a marked increase. Whilst it might not be the overwhelming, 100% result that many would like, the fact is that some is better than none.

Ultimately it does come down to cost. Budget cuts and a fight to keep services without reducing quality is forcing councils, despite their buy local philosophy, to choose the tender that ticks all the boxes, location being considerably further down that list than would otherwise be desirable.