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Government produces outsourcing guidance

21/02/19

Mark Say Managing Editor

The Government has published an Outsourcing Playbook as part of its efforts to improve public procurement.

Playbook cover

Minister for Implementation Oliver Dowden launched the guidance, which follows procurement reforms announced in recent months by Cabinet Office Minister David Lidington. It could potentially have a significant influence on public authorities’ approach to outsourcing, in which digital services often provide a key element.

Among the key policies outlined in the playbook are a presumption that a pilot should be run when a service is being outsourced for the first time. This should help the public authority to understand the environment, constraints, requirements, risks and opportunities, and pilots can provide a lot of good quality data to support planning.

It points to the need for publication of commercial pipelines, market health and capability assessments and project validation reviews. The latter has been required only for major government projects, but the playbook says all complex outsourcing requirements should be subject to the process.

Risk allocation

Public authorities should also ensure that the risk around outsourcing is allocated in a way that reflects a genuine market engagement, and that it is aligned with pricing and payment mechanisms.

In addition, there should be ‘make versus buy’ decisions to identify when it is best to deliver services in-house or to outsource them, key performance indicators should be made public, and organisations should draw up resolution plans in the rare event of a supplier’s corporate failure.

Dowden said: “Outsourcing can deliver significant benefits, including value for money and more innovative public services. Our new measures will improve how the government works with industry and provide better public services for people across the country.

“I can today provide reassurance that the playbook makes explicit that, when designing contracts, departments must seek to mitigate, reduce and then allocate risks to the party best able to manage it. A more considered approach to risk allocation will make us a smarter, more attractive client to do business with.”

Image from GOV.UK, Open Government Licence v3.0

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