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Public Sector Procurement ‘Stifling Innovation’

Public sector procurement processes are “antithetical” to innovation, settling for “proven solutions” from “existing suppliers” and missing opportunities to develop innovative new products and services, according to a report by the House of Lords Science and Technology Committee.

The report examined the way the public sector approached its £236 billion annual procurement spend, and argued that a culture of change must be created to achieve greater efficiency in public sector procurement.

“We recommend that a Minister should be responsible for both procurement and innovation, charged with ensuring that, where appropriate, innovative solutions are used to meet procurement problems across government,” the report said.

“The Minister should be held accountable for how well procurement decisions are made including to what extent innovative solutions had been considered and the reasons why they had not been adopted.

The report singled out the Highways Agency as an example of how innovation could be of benefit. The Agency’s innovative approach to contracting has led to savings of £13 million over the past three years through the introduction of a collaborative procurement network to bring about efficiency savings in road repairs.


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