News 2nd December 2015

8 recommendations for open contracting in the UK

by Alice Gartland

Alice is a consultant with the Open Contracting Partnership.

Open Contracting is a bold idea, reshaping the way we think about billions of pounds of public funding. However, in order to fulfil its potential, open contracting requires an open and continuous dialogue that captures learning, innovation and action right across government, business and civil society.

That’s why, on November 5, we brought together open contracting advocates, implementers and newcomers for a workshop to explore opportunities for advancing open contracting policy, practice and technology in the UK.

The open contracting principles and the open contracting data standard provided the global framework for that conversation, but implementation of open contracting requires a national focus, which the participants provided. Through a series of presentations and breakout sessions, we explored what steps are needed in open contracting to help the UK meet its commitments on open government, nurturing small businesses, fiscal probity and delivering on its new anti-corruption action plan.

The morning presentations and discussions built a picture of the current open contracting landscape in the UK. In the afternoon we turned to focus on the path ahead, with sessions on joining the dots across themes and commitments in the next UK Open Government National Action Plan, and on widening engagement for the future development of open contracting in the UK by including business and contract delivery partners in the dialogue.

The UK government spends an estimated – and growing – £187bn a year on goods and services from third parties. Open contracting is increasingly being recognised in the UK as an essential pillar of open government, a tool for anti-corruption, and conducive to competitiveness and cost efficiency. In 2011 the government launched Contracts Finder, a portal publishing procurement opportunities, with the objective of removing some of the obstacles that prevent smaller businesses from getting government contracts. Two years later, the government endorsed the principles of open contracting in their 2013 Open Government National Action Plan. The plan included a commitment to enhancing the scope, breadth and usability of Contracts Finder.

At the beginning of this year, then Cabinet Minister Francis Maude committed to adopting and trialling standard transparency provisions in government contracts that would compel suppliers to publish top-level information about contracted services, with a view to implementing it in all government contracts from October 2015. However, this appears to have stalled. The Open Government Manifesto, jointly prepared by UK Open Government Civil Society Network, calls for the government to fully adopt the Open Contracting Principles and Open Contracting Data Standard, introduce an open contracting disclosure baseline and promote public participation in contracting.

Overall, while there has been significant activity in the UK on open contracting in recent years, these initiatives have not always been joined-up. Participants identified a range of challenges and opportunities that the UK needs to tackle in order to fulfil its role as world leader in this field.

Challenges to open contracting

Part of the challenge lies in the fact that open contracting is relatively new territory. To engage all parties to the contracting supply chain, there is a need to build awareness of its value and potential within organisations including government, business and civil society.

Open contracting is an iterative process and must be supported by a robust open contracting culture and technological infrastructure. It needs to become the practical and easy choice. To capture learning and innovation there needs to be an understanding that open contracting is an ongoing process and not everything is going to be perfect or correct the first time.

Contracts themselves need to be structured around user needs, with key summaries, provisions for open data & making information accessible to boost competition.

Traditionally, contracts are large cumbersome documents with data that is characterised as incomplete and dispersed. Obtaining contract data and tracking amendments is difficult as original documentation may be incomplete or not kept up to date. Unfortunately, Contracts Finder doesn’t yet host all of the UK’s government’s contracts. In addition, SpendNetwork found that only 30% of UK tenders have matching contract awards, and only 1.5% of UK contract awards provide value and winner details. Unique company and organisation identifiers are also not fully incorporated into Contracts Finder, making it difficult to track a contract across its lifetime. Contrast that with Slovakia, where contracts must be published online in order to be valid and enforceable.

Current approaches to publishing data on contracts do not support the interoperability of data, nor allow government, business or civil society to fully capitalise on its benefits.

Statistics from Digiwhist show the availability of contract data is low compared to other European countries.

Open contracting has been identified as a solution for a range of problems, whether the desire is to drive business and reduce costs for government, increase citizenship participation or improve government efficiency. It is not only about central government – implementation by local authorities is critical and indeed, where most of the engagement with SMEs occurs. Open contracting allows individuals, businesses and civil society to know who they are doing business with and who is investing in their community.

Open contracting can translate internationally and be applied to international aid, including climate finance, which is a growing area for investment. Open contracting will be crucial to successful deployment of those funds, as well as support business in their compliance and risk strategies across supply chains in this era of much greater scrutiny.

Although open contracting is relatively new, there are other projects that can inform how open contracting develops. The IATI (international Aid Transparency Initiative) has demonstrated the importance of embedding transparency into organisational culture, and that requires monitoring and feedback.

Based on the findings of the workshop, and given the challenges and opportunities that the open contracting movement in the UK will meet, we make the following recommendations:

  1. Creation of a UK open contracting forum to exchange ideas, capture learning and development and provide feedback and capture learning across the open contracting supply chain.
  2. Incorporation of robust commitments to open contracting and the open contracting data standard in the UK government’s NAP 2016.
  3. Creation of measureable and not just aspirational targets for the implementation of open contracting in the UK.
  4. Increased collaboration and engagement across government departments and across business and civil society to support monitoring and feedback.
  5. Building on the progress already made and develop an interoperable data infrastructure that reduces costs for government, improves competition and enables implementation of open contracting at a local, national and international level.
  6. Support businesses of all sizes to engage in the procurement process and help them manage their growing compliance and risk management obligations across supply chains.
  7. Translate open contracting to new sectors, such as climate finance and local and international levels.
  8. Embed open contracting into learning and organizational development.

The UK is no stranger to open contracting, but we need to ensure that we work – and learn – together if Britain is to secure its place as a world leader in open contracting.

This post was written by Alice Gartland (Open Contracting Partnership) and Tim Davies (Practical Participation).

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