29. The Cabinet Office has invested significantly in commercial capability over the last few years. Outside observers have said that, since that investment, the quality of the Government's commercial management has improved, albeit from a low base. We look forward to the recommendations of the Public Accounts Committee about the future development of the Crown Commercial Service and the Government's commercial capability. We welcome the Government's decision to invest in this area but we remain concerned. (Paragraph 124)
30. The Government must continue its efforts to improve its commercial capability. Currently, this capability is unevenly distributed among departments. The Government also needs to take care that it does not, through having better negotiating capability, merely drive harder bargains with the private sector based on unrealistic estimates of service quality and cost. The Government needs to move beyond such a transactional approach and develop its understanding of the market and its partners in delivering public services. The Government and its contracting partners should share and express the same values. The Government should set out in its response to this Report its future vision for commercial capability, including measures to encourage collaboration within the public sector and verified trust between the Government and its providers. This should include a new code of conduct which would apply to both Government and suppliers and set out expectations of behaviour and shared values. (Paragraph 125)
31. The Government needs to improve, as our predecessor Committee suggested, its understanding both of risk transfer and of costing Commercial skills cannot be seen in isolation from other skills. We believe that it is vital that staff with commercial skills work alongside staff with other skills such as costing, project management, IT and financial planning in letting contracts. They should also work alongside staff with deep subject knowledge and expertise. In its response, the Government should set out its plans to integrate together teams which have IT, project management, costing, financial planning and commercial skills and possess deep knowledge and expertise. (Paragraph 126)
32. The Government can only let and manage contracts successfully if it has the right data. The Government admits that it needs to improve its internal data. We are concerned by the fact that the Government has not systematically analysed where and how it spends taxpayers' money on procurement. This includes data not only about current contracts but also about areas that the Government wishes to purchase in the future. We welcome the Government's commitment to improving its data about contracts. (Paragraph 133)
33. We welcome the Government's intention to publish a number of key performance indicators. We also welcome the comments from the private sector in support of this. The Information Commissioner is right to say that transparency is a key principle of democratic government. She is right to insist that, as more diverse models of service delivery develop, the Government should ensure that transparency is not lost. (Paragraph 134)
34. The Government needs to improve its internal information so that it can design, let and manage contracts more successfully. The Committee has made this point before in other contexts. The examples in this report strengthen the case that the Government needs to develop a full understanding of the services it provides to the public. The Government should set out in its response how its strategy to improve management information will tie into its commercial strategy. (Paragraph 135)
35. We understand the Government's concerns about the implications of increased transparency for some smaller contractors, and such requirements should be proportionate. However, we think that the principle that Parliament and the public need to have key information about the delivery of public services is important. The Government should set out in its response to our report which key performance indicators it has decided to publish and its justification for the choice of those indicators. The Government should work with the Information Commissioner to ensure that revisions to the Freedom of Information Act address her concerns. (Paragraph 136)
36. We recommend that the Government should consult with the Local Government Ombudsman and the Parliamentary and Health Service Ombudsman about the problems identified by the Local Government Ombudsman in relation to complaints made about private sector contractors, over whom he has no jurisdiction. We agree with the overarching principle that all users of public services, regardless of who delivers the service, should have the right of access to an independent ombudsman. The Government has already published the Public Sector Ombudsman Bill in draft and this should be amended. (Paragraph 137)