Once upon a time, not so long ago, UK government ministers and officials couldn’t set foot on a public platform at a technology event without laying into the misdemeanours of the 'oligopoly', that fabled cartel of ‘big ticket’ providers to the public sector that had dominated procurement for decades.
But it’s a sign of the times that the ‘oligopoly’ word is no longer part of the public sector lexicon.
Quite how far we’ve moved on could be seen yesterday when John Manzoni, the head of the civil service as well as permanent secretary to the Cabinet Office, stepped onto the stage of a leading member of that ‘oligopoly’ and came not to bury, but to praise it.
There can be no doubt that Hewlett Packard, for some years the biggest provider to the UK government, was part of the ‘oligopoly’ hierarchy. Its ranking has slipped in recent years, largely due to its dependence on central government spend, which makes up over 90% of public sector revenues.
That spend has declined with the inevitable knock-on effect on HP. This, combined with the Cabinet Office’s policy of breaking down big outsourcing contracts, has taken its toll, although the firm’s ability to win business still was seen in the award of a three year hosting deal with the Department of Work and Pensions earlier this year.
But still, after years of seeing leading Cabinet Office officials and ministers, it still takes some re-adjustment to hear Manzoni bigging-up the big suppliers that have been demonised for so long:
I believe, we are doing some of the most important things in the UK government and we need some of the best companies to help us.
Just focusing on the very small companies isn’t going to be good enough. We need to create partnerships and opportunities for the very best companies in all ways to come and help us.
Manzoni did name check initiatives to open up government business beyond the big ticket firms:
The G-Cloud, the Digital Marketplace, has been an enormous success for us. It has opened up access to government in a way that we haven’t seen before. It has created opportunities for Small and Medium Enterprises. We’re spending something north of £800 million through the Digital Marketplace and 50% of that is to SMEs.
But he added that these firms couldn’t provide everything needed to address what he called the “complex environment” of the public sector’s needs:
We need to create partnerships and we need to create opportunities for the very best companies in all ways to come and help us do what we need to do.
The public sector is a complex environment, it’s a difficult environment. The job is far far from done. Even with the largest companies in the world, we’ve still got a lot to do.
Can't do it alone
One reason for the need to work more closely with big suppliers is the ongoing lack of internal skills within government circles, he added:
We need more skills inside government, but I don't think, in the end, we will ever be able to create enough of the right skills just inside the government.
So, it brings me back again to the importance of finding constructive and collaborative ways of partnering with the private sector in a way which is mutually beneficial. It’s not about one side taking advantage of the other.
We in the public sector have to completely up our game in a commercial sense in regards to our way of interfacing with the private sector. And in return especially in the digital and technical space we are demanding a different sort of interaction from the private sector with government.
For its part, HPE made the most of its coup in having Manzoni making a personal appearance at a provider’s conference, praising the UK for being a leader in government digital transformation and one that is setting an example to administrations around the world.
Manzoni accepted the compliments with grace, arguing that the UK plays a leading role on a global scale, although rather strangely illustrating this by referring to defence spending. (Today’s vote in Parliament over bombing Syria may have been weighing heavy in his mind?)
The unmentioned elephant in the room amid all this mutual back-slapping was the report from the National Audit Office (NAO) criticising the role of the Cabinet Office and the Government Digital Service in the ongoing digital transformation problems at the Department for Environment, Food and Rural Affairs (Defra).
That said Manzoni did allude to the ongoing problems with big ticket public sector programmes:
In the public sector, one’s mistakes tend to be a little more public than in the private sector. If you actually look at the data, let’s take the big infrastructure projects, the data suggests that the public sector is no different to the private sector in success or otherwise of infrastructure projects. Government is getting better and better at understanding how to do that. That’s good news.
But still things go wrong, he admitted:
I’m sure we all struggle with technology projects. There are characteristics of the public sector that make it slightly more complex. The operating environment in which we do these projects is simply more complex. We don’t have the orienting function of profit which aligns organisations and can hugely simplify the operating environment. In the public sector, we don’t have that. It is a massively more complex operating environment. That can sometimes get in the way.
But Manzoni insisted that things are getting better:
Having said that, we are making good progress. We have big, big programmes in welfare, the Universal Credit. We’re digitising the personal tax account. These are big, big programs which are transformational in their sectors.
While I’ve been of the opinion that the ‘oligopoly bashing’ of recent years had rather run its course, I have to admit to a certain unease about the head of the civil service standing up on stage as guest star at such a major supplier to government.
But well done to HPE - quite the coup.