Magazine article Public Finance

Contract Control Remains Fragile

Magazine article Public Finance

Contract Control Remains Fragile

Article excerpt

The government has improved how it manages outsourced public services contracts, but these reforms are fragile and could still fail, the Institute for Government has warned.

The think-tank reviewed Whitehall's progress in boosting its contract management performance in the wake of several high-profile failures.

Contracting came under scrutiny following the failed procurement process for the West Coast Main Line rail franchise in 2012, and after the IfG found in 2013 that G4S and Serco had billed the Ministry of Justice for millions of pounds worth of electronic tagging services that had not been carried out.

The IfG noted in Building Commercial Capability in Government that many services, including tax and benefits systems, are maintained by private sector businesses. In addition, most government departments rely on contracted suppliers for payroll, energy, facilities management and consultancy services.

Weaknesses in supplier management often caused the government to underfund or overpay providers, give work to incapable organisations or fail to ensure users had a say in services.

These failures were typically caused by a shortfall in commercial expertise, in both the policy-making and the implementation stages. …

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