Competitive Tendering Is Plundering Your Pocket

 

Since it's that time of year, I'd like to explain something about the council tax bill which landed on your doormat recently.
You see, I have been trawling through a public sector 'competitive tendering' opportunity today. I place the description in inverted commas because there is nothing very competitive about its 200 bloody pages.
To illustrate, I'll go back around a decade to when such things really did pit suppliers against each other in a cut-throat mechanism which drove down costs to provide value for the taxpayer buck. It was a time when large operators were capable of being usurped by a one-man-band offering a quality service at a homemade price. The more providers, the lower you had to pitch to be sure of getting the work.
Those days are long gone.
About five or six years ago, in our experience, the regulatory burden began increasing at an alarming rate. Health and safety was ramped up to quite absurd levels and quality thresholds were set which were impossible for small outfits in our industry to comply with. For example, a company like ours - with a tad more financial breathing space by virtue of our larger size - were able to implement all of the ridiculous (and not even mildly more protective) demands placed on the vehicles which would be acceptable to the authorities concerned. The little guy had no chance - unlike us - of throwing a load of cash at new, or adapted, vehicles to cope with the latest over-weening directive imagined by local authorities, none of which would have any effect on overall safety or provision of service.
We thrived as a result, while dozens of our competitors threw the towel in and went and did something else instead (that's if they did anything but sell their rig and roll up to the local social security office, of course). Happy days for Puddlecote Inc, but we were - as economics dictates - charging far more to the authority.
With competitors shorn from the market, and our costs increased by compulsory demands from the provider, we got paid more ... for doing the same job. We also did a lot more of those jobs, at a higher price, than before. Our proportion of the market increased, and the prices we charged for the larger percentage of that market, were necessarily higher solely due to the actions of the tenderer.
In just a couple of years, the reponses to competitive tendering exercises had been more than halved, with the pool of approved suppliers slashed by bureaucratic ideology.
The latest opportunities, received last week, are prefaced by a preamble which states that they are looking to make 20% savings in light of instructions given to them by their 'leader'. You'd be forgiven for thinking that he had told them to massively ramp up costs.
Reading through the documents today was a jaw-dropping insight into the dream world of public sector morons.
Method statements, framework agreements, key performance indicators, robust performance management systems, equality and diversity policies, performance evaluations, environmental advancement, partnership milestones, sustainable procurement narratives, race and gender statements, service quality monitoring, volume forecasting, operational delivery reviews, governance structure audits, outcomes recording methods, business continuity plans, and contingency planning systems.
All of the above must be installed before we are even allowed to see the work we may be able to bid for, if approved. And, of course, there is no guarantee - by their own admission - that it will be of any quality.
As far as we are able to ascertain from those fellow operators we are friendly with, the competition has just been halved once again. Like before, we are large enough to gamble on all this, but others have fallen by the regulatory wayside.
Of course, once again costs have no way to go but up, and with less competition, we are likely to get more of the proportion of work available. The taxpayer gets shafted while the public sector office fills its boots with council tax cash.
And the end result? Well, they can say that greedy private sector businesses are ripping off the taxpayer and that competitive tendering - introduced by Thatcher IIRC - just doesn't work.
Clever, huh?
Remember, our industry is just one small part of public sector outsourcing. Every supplier, in every field, is being put through this. Raising costs, and punishing your bank account with every monthly council tax instalment as a result.
It can't be avoided, either. You see, the whole process is run according to the Public Contracts Regulations 2006, which - as I'm sure will not in the least surprise you - is the UK enactment of European Directive 2004/18/EC.
Competitive tendering is supposed to act against monopolies and cartels, yet EU legislation is actively encouraging them in every town hall up and down the UK.
Seriously. We need a referendum, and quick.

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