Government Commercial Function Presentation for the Public Sector Show 2019

1. Government Commercial FunctionPresentation for the Public Sector Show 2019 Gareth Rhys Williams Government Chief Commercial Officer

2. Vision “The Government Commercial Function will be the best commercial function in the UK” Mission “The Government Commercial Function exists to enable Government Departments (and the wider public sector) to deliver their aims at best value for the taxpayer.”

3. Significant progress on putting the building blocks in placeIncreasingly recognised by NAO, IFG, Private Sector What do we need to put In place to achieve this? What tools have we developed to make this happen? • Professional Standards / Assessment & Development Centre (ADC) / Recruitment Hub / Enhanced L&D – ‘B to A’ and ‘A to A*’ / New Pay Models / Talent Mapping / Succession Planning / Contract Management Standards / Gov’t wide Contract Management training / Career Pathway / D and I approach • Functional Structure / Blueprints / Gateway Panels / Knowledge Hub 2 / CFLG / GCO Customer Board / GCO User Board / STL’s for Contract Management / PPRS team • Commercial Operating Standards / Peer group reviews / Red team reviews / GCF lectures / Masterclasses / Departmental Dashboards / CaSIE / Consistent Supplier Management / Past Performance data / Big deals community / Model Services contract suite / SRM Guidance / Open Book Margins / KPI collection / Outsourcing Playbook / Financial Distress Guidance Right people Right structure Right systems and method (Red = new in 18/19)

4. GCF: Logical structure in placeIncreased clarity on who does what Building professionalism and leveraging ‘shared’ resources to maximise effectiveness Department Commercial Teams Crown Commercial Service Central Commercial Teams • Buyer of choice for ‘common goods and services’ for Central Gov’t and Wider Public Service: • Frameworks for categories that everyone buys: • Buildings • Technology • People • Business Services • But not doing bespoke work or contract management that should better be done back in Departments • C. 650 people • Departmental focus • Buying bespoke, mission specific goods and services • Deep understanding of policy and business areas • Responsiveness and flexibility • Efficiency and Continuous Improvement • Contract and performance management depending on Departmental structure • C. 2,500 people • Commercial Policy; Procurement regs, guidance notes, SME policy • Continuous Improvement; Assurance, Commercial Standards, Benchmarking, Masterclasses • Complex Transactions; expert support for high value negotiations and disputes. • Market & Supplier Partnerships; Consistent approach for the top 35 “Strategic” suppliers • Capability: Attract, Retain, Develop and Reward our talent • C. 250 people

5. Government Commercial FunctionCentral Commercial Teams The Government Chief Commercial Officer shapes and leads the programme of commercial reform across Government. Commercial Continuous Improvement Director: Mark Roberts Responsible for improving commercial across HMG. The work to raise standards and support best practice benchmarking to deliver better VFM, efficiency and consistency. Mark.Roberts@cabinetoffice.gov.uk 07801 405853 Gareth Rhys Williams, Government Chief Commercial Officer Chris Hall, Deputy Chief Commercial Officer Markets and Suppliers Director: Coleen Andrews Responsible for providing robust analysis on suppliers, the sector and key markets, and management of strategic suppliers through Crown Reps and the Strategic Partnering Programme. Coleen.Andrews@cabinetoffice.gov.uk 07880 711 805 Complex Transactions Director: Victoria Filkin Responsible for providing specialist support on the most challenging commercial objectives by offering advisory services, oversight and embedded support. Victoria.filkin@cabinetoffice.gov.uk 07825 386 501 Commercial Capability Director: Marco Salzedo Responsible for improving commercial and contract management capability by recruiting, assessing, and developing high calibre commercial staff. Marco.salzedo@cabinetoffice.gov.uk 07866 433968 Policy Director: Sam Rowbury Responsible for providing advice on procurement policy. This includes small business, domestic and EU/International policy. Sam.rowbury@cabinetoffice.gov.uk 07795 646020

6. Departmental Commercial DirectorsWell recognised, working as a network David Taylor Home Office Tracey Williamson FCO John Hatton DWP Rob Woodstock HMRC Barry Hooper MOJ Andrew Forzani MOD Steve Oldfield DHSC Nick Elliot DE&S (MOD) Melinda Johnson DHSC Paul Rodgers DfT Einav Ben Yahuda DEFRA Paul Kellett DIT Emma Ferguson Gould BEIS Claire Benham DFE Jacqueline Rock DIO (MOD) Jin Sahota NHS Supply Nick Ford DFID Simon Tse CEO, CCS Marc Bryant DCMS Tim Rogers CO & HMT Andy Hobart MHCLG

7. How the function works for departments

8. Significant progress in last 3 years Delivering savings and performance through better capability Improved Capability • More than 2,000 individuals assessed through ADC; commercial training up and running • Over 500 commercial specialists recruited or promoted through the Recruitment Hub since 2016 • Supplier Management: “Crown Reps” established for top c.30 vendors, with associated training Improved method across an increasingly integrated Function • 2,800 colleagues on Knowledge Hub (2); 75 interest groups across Govt and ALBs / WPS • Monthly reviews with Commercial Directors; Benchmarking / Masterclasses every 3 and 6 months. The application of commercial standards and the sharing and embedding of best practice supports increased risk mitigation • Continuing need to understand the aggregate risk in the supply chain for major strategic suppliers in key markets across government Results • £2bn + “Commercial Benefits” in each of last three years, £1.4bn contributed in 17/18 by GCF central teams as audited by GIAA • Carillion, Interserve, ‘Clinical Waste’ and other examples all showing value of a joined up function • Improved contract RAG ratings and Dispute statatistics across government • Brexit: New IT system for public procurement ready for use, and GPA trade deal agreed

9. Focus for 19/20EU Exit …. and three other game changers EU Exit • Transactional resource / support ready to stand back up as and when required • Prepare ground for future Green Paper on proposals and modifications to Procurement Regulations post Exit Commercial Policy • Prompt Payment - Legal route to exclude vendors (and then their vendors) who are not paying promptly (60 days), starting Sept 2019 • Lead action across government to increase public procurement spend with SMEs towards the Manifesto commitment of 33% of spend by 2022 • Implement new model for taking account of social value in central government procurement using a menu of agreed metrics Outsourcing Playbook Implementation • 11 ‘plays’ across ‘Right at the start, Resilience, Resolution, Reform’, principally for ‘complex outsourcing’ • Pan gov’t training and knowledge drops, followed by ‘On the shoulder’ support for departments working on in-scope procurements Capability / People • Contract Management -Training of 30,000 colleagues leading to accreditation at Foundation, Practitioner or Expert level, on central register • Identification of qualified contract managers will allow publishing of KPIs, and capturing of ‘Past Performance’ to inform new tenders • Completion of transfer of all Commercial Leader (Grade 7s) into the GCO

10. Focus for SR period (19/23)Increasingly integrated; adding real value on top of savings Integrated and proportionate Assurance replacing ‘Controls’ • Compilation and publication of future commercial pipelines, allowing earlier market engagement, and proportionate and in-line value adding assurance Exploitation of Functional Data: validation, application and transparency • Validation of data entered into departmental systems will ensure Contracts Finder, CaSIE and Past Performance analyses are accurate • All major categories to have standard, collaboratively written category plans; shared market knowledge avoids market failure Increasingly integrated with Departmental Policy and Ops teams • ‘Multi-functional by default’ teams when ever procurements are involved: Policy / Commercial / Finance / Contract Management / Ops Focus on Delivery, Delivery, Delivery • But WPS spend of £190bnhas to be a target for savings and delivery improvement

11. “The Government Commercial Function will be the best commercial function in the UK”