Alongside the National Procurement Policy Statement, the English Devolution White Paper gives important clues about the current government’s priorities in public sector tendering.
We explain how the White Paper is relevant to public procurement, the statistics on local government tenders, potential impacts of the White Paper and how bidders can do more business with local government buyers.
What is in the English Devolution White Paper?
Containing an introductory section from Deputy Prime Minister Angela Rayner, the White Paper aims to embed a principle of ‘devolution by default’ in government organisations and contracting authorities.
Through this method, the government aims to improve economic growth, equality between different regions of the country, and empower local communities to make their own decisions. This includes giving new powers and freedom to procure goods and services using the local authority’s budget without the central government’s involvement.
The White Paper defines two new local government structures:
- Strategic authorities which include a population of at least 1.5 million people, possessing full powers over housing, transport and skills/education
- Unitary authorities which cover populations of up to 500,000 and will replace the two-tier council systems which are operated in many regions.
Restructuring of local governments will shift budget responsibility away from the central government departments, resulting in increased autonomy and financial power.
Local government procurement statistics
According to data collated by Tussell, local government spend on procurement outpaces that from the central government already. Between the 2019–20 and 2023–24 financial years, local government spend increased by 35%, demonstrating the key position of sub-central authorities within public sector procurement.
If the proposed changes in the White Paper are implemented, up to 57% of local procurement spending could be attributed to unitary authorities, as defined above. With sub-central authorities already spending more with SMEs than central authorities, strategic and unitary authorities will undoubtedly become key target markets for small- and medium-sized businesses.
What is the impact on public sector tenders?
Ultimately, the reforms proposed by the White Paper will have a major impact on public sector tenders. Prospective bidders should be conscious of the following impacts.
Consolidated contracts or framework agreements
Existing sub-central authorities – for instance, Newcastle City Council – may merge into or align with new, larger unitary or strategic authorities, such as the North East Combined Authority. The resulting mergers may result in one or more of the following:
- A decreased volume of contracts available, but higher contract values across the region
- While larger suppliers are unlikely to be impacted, smaller suppliers lacking geographic coverage may be affected
- Smaller suppliers opting to submit a consortium bid to remain competitive within the new markets created.
Disruption of existing frameworks
Many suppliers rely on central government frameworks such as Crown Commercial Services frameworks or others to secure a pipeline of work. Should public procurement become more localised, this reliance may shift to local government frameworks – particularly for high-volume services such as maintenance and repairs or passenger transport.
As such, bidders who are not aware of the local frameworks may be locked out of high-value opportunities, as they are not on the call-off list for the relevant framework – underscoring the importance of monitoring upcoming tender opportunities.
Strategic buying activity
With sub-central authorities emboldened to run more competitive tender processes as part of the principle of ‘devolution by default’, the strategic element of the bid process may become more unique depending on the authority running the exercise.
This could include a greater emphasis on the local and regional challenges to delivering the contract or benefits the supplier can deliver – through social value, for example.
Equally, the introduction of dynamic markets from the Procurement Act may be adopted at the strategic or unitary authority level.
What can bidders to do win more business with local government?
Local government organisations are excellent customers, with strict payment terms and a steady stream of work across contracts and frameworks spanning multiple years. As such, you should dedicate time to your bid strategy and sourcing of suitable tenders by adhering to the following:
- Research your target market by understanding which authorities (including strategic and unitary authorities) are responsible for the works or services you deliver
- Adapt to new frameworks by identifying and registering your interest for new opportunities, using the government’s Find a Tender and Contracts Finder services to monitor active tenders and pipeline notices
- Tailor your value proposition in submissions by emphasising the local aspect of your quality responses, through local priorities, cost efficiency and job creation or retention
- Review your social value initiatives and tailor these to the specific opportunity, ensuring that your proposed commitments are targeted, tangible and proportionate to the overall contract or framework value.
Ultimately, prospective bidders should be proactive in securing business with local authorities – and ensure opportunities are sourced early in the submission window to maximise the time for completing your bid.
Support with local government tenders
Our expert bid and tender writers support clients with more than 700 public sector submissions each year, with a large percentage of these being local government tenders. As such, we are highly experienced and ideally positioned to add value to your bid, including tailoring quality responses to the specification and contracting authority, and applying research to local challenges and priorities.
To discuss further with our sales and marketing team about how we can support you with a local government tender, contact us today at info@executivecompass.co.uk or via telephone 0800 612 5563.