Friday, 29 April 2016


When spending public money, it’s important to work it extremely hard and extract every single possible benefit. We need to take a fresh look public sector procurement of goods and services in Wales and ensure that an increasing percentage of our public sector spend is targeted towards local businesses and local suppliers. When taxpayers’ money is being spent, it is important that every single possible added value be squeezed out of it and it is vital that we spend as much of possible of it as we can to support Welsh businesses. 

At a very simple economic level a sustained and encouraged ‘buy local’ campaign is a real economic must, while this will necessitate legislation to improve public procurement, it is something that can provide real opportunities for Welsh based business within the procurement chain – potentially this could create some 50,000 new jobs. Significantly improved local procurement policy can create and secure jobs, boost employment levels and help small to medium sized enterprises in many of our communities. 

Again at a very basic level it comes down to maximising the local economic opportunities from the £ 4.3 billion pound public sector spend in Wales – which is used to procure and purchase goods and services.  There have been some real improvements when it comes to public procurement over the last ten years, but, there is still room for substantial improvements to be made.  The increase in Welsh procurement of goods and services from 34% in 2003 to 52%  (June 2012) something that follows extensive efforts by Plaid Cymru as part of the One Wales government (between 2007 and 2011).

A Plaid Cymru government will legislate to make it mandatory for public sector bodies to follow Welsh Government policy on procurement. Social, employment and environmental considerations will be given the same weight of consideration as price when choosing a supplier.

The Party of Wales will use the freedoms provided under the new Public Contracts Directive to achieve maximum social and environmental benefits, including payment of the Welsh Living Wage for all employees and the MacFarlane standard of a minimum of one year’s employment for a person from a disadvantaged background employed per £1 million expenditure. We will also seek to expand and extend the role of the social sector in the provision of public services and goods.

All public sector agencies will need to reach agreed standards of one procurement specialist, with appropriate professional accreditation, per £10 million expenditure by 2020. We will provide direct funding for an additional ten experienced public procurement managers to the National Procurement Service to increase our ability to achieve our goal of increasing local purchasing while continuing to improve quality of service.

All public authorities in Wales, under the aegis of the Welsh Government, will be required to provide comprehensive real-time supplier information so that we can operate a Open Contract system publishing the details of every public service supplier and buyer in Wales, including future pipelines, providing an accurate and up-to-date picture of the level of Welsh SME procurement while helping increase it.

We will set a target of keeping 75% of first-tier Welsh public procurement expenditure within Wales, with locally-owned or locally controlled firms, cooperatives and charities (defined on an independently agreed basis), to create in excess of 40,000 new private and social sector jobs, and develop a further target for 2nd tier and 3rd tier suppliers in larger contracts.

We will achieve this in part through ensuring appropriately sized contracts for small and medium sized companies and by providing direct support to Welsh firms seeking Welsh public contracts. The new WDA will work with the National Procurement Service to identify two to three initial priority areas for supply chain development e.g. construction and care services. Our Government will establish a digital currency for Wales – the first of its kind at a national scale – and use it on an experimental basis to procure services and accept payments to measure its potential for retaining the flow of money within the Welsh economy.

The bottom line has to be that if we are going to spend public money then it is only right that it be worked extremely hard and we need to maximise the economic impact every single penny and every single pound and to make sure that it works to help the Welsh economy. Back in 2013 for every £2 spent procuring goods and services, £1 of that ‘leaked’ out of Wales and the Welsh economy.  Value Wales suggested that for each 1% increase in goods or services procured from Wales, some 2,000 jobs are created.

So if we can achieve a local public spend of something close to 75% then potentially some 46,000 additional jobs can be created. The impact of a well thought out and implemented public procurement policy is something that could economically give and give again. This is the crux of the matter, it could be a real win win situation for Wales, potentially cutting unemployment by around a third or about the same number as the increase in unemployment that we have suffered since the recession began. 

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