In the wake of Carillion’s collapse and strong criticism of its handling of outsourcing contacts, the government has issued new guidance on outsourcing decisions and contracting, in a bid to ensure that it gets right more projects from the start, engages with a diverse and healthy marketplace of companies, and is ready for occasions when things go wrong
The government is also taking steps to improve the design of outsourcing projects from their inception. New complex contracts will be piloted with the private sector before rolling out fully, enabling the government to learn from experience.
Further measures in the Outsourcing Playbook include suppliers drawing up resolution plans, or ‘living wills’, in the unlikely event of business failure, and requiring them to publish key performance data.
Oliver Dowden, cabinet office minister, said: ‘I can today provide reassurance that the Playbook makes explicit that, when designing contracts, departments must seek to mitigate, reduce and then allocate risks to the party best able to manage it.
‘A more considered approach to risk allocation will make us a smarter, more attractive client to do business with.’
Departments will be required to regularly publish their upcoming requirements, to help suppliers plan ahead, and to identify when it is best to deliver public services in house or when there is benefit to drawing on the expertise of the private sector.
The Outsourcing Playbook is here.
Report by Pat Sweet
