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John Tizard: Grenfell Tower – procurement lessons must be learnt

Friday July 14th, 2017

The content of this blog reflects the author’s views, which are not necessarily those of BiP Group

John Tizard

John Tizard

The Grenfell Tower fire was an appalling atrocity. The human consequences are horrendous and will sadly continue for many years.  Lessons must be learned.

Quite rightly, the Government has established an enquiry, which must have as wide a brief as the local community wants, and all local stakeholders must have confidence in this enquiry. Just as significant are the necessary but separate enquiries by the police and the fire service.

There are many questions to be asked about social housing standards, investment, management and governance, and the impact of austerity – as there are about contemporary wider social and economic inequality in the UK.  The fact is that as a ‘place’, Kensington and Chelsea does epitomise ‘a tale of two cities’.  These questions should be central to the enquiries but there is a plethora of other issues to be examined and questions to be answered.

Whilst it is important not to prejudice the forthcoming enquiries, some issues are seemingly self-evident, some can be addressed relatively quickly, and some will take longer. Nowhere is this more evident than in the importance of understanding the lessons for public procurement and contract management.

In this regard, I would expect any enquiry to want to explore the following issues and to make appropriate recommendations. For example:

  • when a local authority or other public body delegates the management of a service to another body as was the case at Grenfell, where social housing management was contracted to a tenants’ management organisation (TMO), what responsibility does/should the authority retain for the quality of the service and its safety; and what role should tenants and other service users
    have in such arrangements?
  • given that a local authority or any other public body cannot in normal circumstances delegate and/or outsource its accountability, how should an authority ensure that it is accountable when it establishes a TMO or equivalent or outsources functions?
  • when service implementation, construction, regulatory inspection and maintenance work is contracted to third party contractors (as will usually be the case), how does the client:

o   know what standards (including safety standards) to specify

o   ensure that as standards change, these are reflected in housing and related provision

o   have an appropriate risk policy that is agreed by politicians and is both  transparent and understandable to all stakeholders

o   ensure that it is willing to pay for quality provision and not cut corners (or allow contractors and sub-contractors to cut  inappropriately corners) to ‘save’ money

o   ensure that the contractor is meeting all regulatory requirements in terms of service design, implementation including construction, employment practices and supplies of equipment and materials

  • that any sub-contractors meet required standards and specifications
    • and what should the public client do to test the quality of the supply chain

o   test that the contractor is complying with specified quality, safety and regulatory standards

o   involve tenants/service users in contract specification, contractor selection and the monitoring of implementation?

  • should inspection and contract management be a retained local authority / public sector responsibility (which is not outsourced) and, if it is ever outsourced, to what kind of organisations, with what accountability?
  • ensure that public sector bodies have the right quality client capacity (including contract management capacity) if and when it outsources?
  • how a procuring public body can and should test the business model (including ownership, management, supply chain management, commodity procurement, employment practices, quality control and commercial and financial structures) – ensuring all are appropriate for  the contract being considered
  • understand contractors’contingency plans and how these complement the public bodies own contingency plans

These and many related questions must be examined honestly. Inevitably, their exploration is likely to raise wider questions about the traditional public sector outsourcing model.

The Grenfell Tower tragedy will haunt the local community for a long time, as it will the local authority and government. And it is likely to remain on the public conscience for a long time too.  It is essential that we learn every lesson possible from this dreadful incident, which must include the lessons for outsourcing, public procurement and contract management. These must be swiftly identified, and resultant changes to current practice urgently and fully implemented.

 

 

 

 

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