The Cabinet Office is working on guidelines for a supplier blacklist in a move designed to encourage suppliers to maintain high performance standards.
Cabinet Office Minister Francis Maude (pictured) has written to his Cabinet colleagues to outline a new process for blacklisting suppliers that fail or fall short of contracted requirements, potentially barring them from bidding for further contracts across government.
"When awarding new contracts to large suppliers, government has not always taken existing performance into account. Too often this has resulted in suppliers winning new business, even when they were materially underperforming on critical work elsewhere in government," wrote Maude. "This is something that the best-run private-sector businesses would not tolerate, and nor should we."
He added: "Instances of underperformance, however rare, must be tackled robustly and resolved swiftly particularly as we move to open up public services. Therefore the chief secretary and I have agreed a mechanisms for officials to recommend that a supplier be regarded as ‘high risk' where material and substantial underperformance is evident."
He concluded: "In these cases departments will be asked to engage with the Cabinet Office at each stage of any procurement process involving the affected supplier to ensure that performance concerns are taken fully into account before proceeding." [our italics]
Tony Collins, co-founder of the UK Campaign4Change, welcomed the move. The same ring of big-name suppliers, he said, have been repeatedly named and shamed for poor performance, but poor performance was rarely taken into account when they tendered for extensions or for new projects.
"It is unlikely the Cabinet Office's blacklist will rule out any suppliers from a shortlist," said Collins. "Suppliers will claim that any problem was all the fault of ministers or civil servants who kept changing their minds, were not around to make key decisions, or didn't understand the nature of the work."
He added: "But still the blacklist is a worthwhile innovation. At least one big IT supplier has made a habit of threatening to withdraw from existing assignments when officials have refused to revise terms, prices or length of contract. The blacklist will strengthen the negotiating hand of officials.
"The challenge for Maude will be persuading departments to take the blacklist idea seriously," he concluded.
However, two suppliers have already been blacklisted, according to reports, although who they might be is currently a source of speculation.
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A discussion of the "risk perception gap", its implications and how it can be closed