Event Round-up: techUK x Tussell: The state of Local Government tech procurement

This webinar offered a deeper understanding of the landscape of tech procurement and identifying opportunities for innovation in local government and how unlocking better procurement processes, can foster innovation and digital adoption, looking at the wider landscape through local government spend but also looking at procurement processes from a supplier and buyer perspective, outlining some of the challenges but also the opportunities.

Setting the scene

Emily Witter, Senior Data Researcher, Tussell, provided an analysis of the local government tech market, emphasizing the growth in IT procurement spending during the pandemic and the ongoing trends. She noted that local government IT spending has increased by 15% over five years, but it only constitutes 3% of total procurement spending in FY 23/24, indicating a potential lag in digital transformation compared to central government and the NHS, which have seen much higher growth rates of 46% and 81%, respectively. This analysis underscores the need for suppliers to understand the local government tech market, build relationships with key decision-makers, and stay informed about upcoming opportunities to succeed in this competitive landscape.

Procurement from the Supplier and Buyer perspectives – techUK LPSC Procurement report

Helen Gerling, CEO of Shaping Cloud and techUK Local Public Services Committee member, and procurement sub-group co-lead and Denis Kaminskiy , Founder and Strategy Director of Arcus Global, and Vice-Chair techUK Local Public Services Committee, and procurement sub-group co-lead , shared insights from a qualitative survey of buyers and suppliers, highlighting six recurring themes that emerged from their research. They identified visibility of opportunities, strategic misalignment, and price versus reputation as significant barriers to effective procurement. A notable finding was that 85% of suppliers felt they could not spot relevant opportunities, and nearly half reported missing most relevant tenders, especially direct awards. They emphasised that these issues are systemic and not just noise and believe that addressing these challenges requires a concerted effort from both buyers and suppliers to improve visibility, strategic alignment, and the overall procurement process

Local Government perspective

Cassandra Gardiner (London Borough of Redbridge) articulated the complexities local authorities face in procurement, particularly regarding risk aversion and the necessity for compliance with regulations. She outlined that procurement processes can take a considerable amount of time, often nine months to a year, and stressed the importance of early engagement with suppliers to align on future needs and expectations. Overall, the key insights were, the need for clear communication, early engagement, and a deep understanding of the local authority's strategic goals and regulatory environment to navigate the procurement process successfully.

Challenges and Recommendations

Challenges faced by local government in tech procurement:

Visibility and Access: Suppliers expressed concerns about visibility into procurement opportunities, particularly with direct awards
Framework Utilization: Many suppliers felt locked out of contracts due to not being on the right frameworks, leading to a perception that larger firms have undue advantages
Price vs. Quality: There is a disconnect between the emphasis on price in procurement decisions and the actual value delivered, with many buyers reporting dissatisfaction with outcomes despite prioritising cost

To address these issues, recommendations included:

Early Engagement: Encouraging local authorities to engage with suppliers before the procurement process to better align on goals and expectations
Transparency in Pricing: Local authorities should ensure that procurement documents clearly outline all potential costs, including additional fees for services like APIs, to avoid unexpected expenses
Leveraging the Procurement Act: The new Procurement Act 2023 is seen as a potential avenue for improving market efficiency, although skepticism remains about its practical impact on entrenched issues

Conclusion

The discussion highlighted the critical need for innovation in local government tech procurement and the importance of collaboration between buyers and suppliers. As local authorities navigate significant changes in their operational frameworks, fostering open communication and transparency will be essential for driving successful procurement outcomes and ultimately enhancing service delivery to residents.

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Scalable Approach to Vulnerability via Interoperability (SAVVI) Tech Working Group

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This is part of the Scalable Approach to Vulnerability via Interoperability (SAVVI) programme. We are convening this working group to ensure that suppliers have early sight of the SAVVI standard to ensure it is fit for purpose.

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techUK members are transforming public services in the UK. Our community help to shape a smarter, digitally empowered public sector.

techUK drives public sector digital transformation by uniting the public sector and tech industry. Through early market engagement, efficient procurement, and innovative technology adoption, we help to modernise legacy IT, and enable efficient, secure, and personalised services.

Get involved: We run a busy calendar of activity including events, reports, and insights that demonstrate some of the most significant digital transformation opportunities for the sector. Our Transforming Public Services Hub is where you will find details of all upcoming activities. We also send a monthly public services newsletter to which you can subscribe here.