FM Procurement within the Public Sector

Summer 2010 saw the UK government announcing the names of eight companies (Skanska, Norland Managed Services, Mitie, Interserve, Europa, EC Harris, Carillion and ISS) that had been allocated a place within the governments’ facilities management framework agreement.  Some of these companies are still heavily affiliated with public sector contracts today but we have also seen the addition of other organisations to include that of G4S and Serco. Both who have recently been victims of negative publicity as a result of underperformance in public sector facilities management delivery.

The public sector still outperforms the private sector when it comes to the outsourcing of facilities management.  In Q3 2013, figures announced this difference to be as high as 46%.  It is no wonder that we have seen increasing reports and articles surrounding the change that potentially looms regarding public sector procurement and equally the problems that have been experienced, particularly in the instance of the London 2012 Olympics when G4S struggled to provide their agreed services and when Serco and G4S were found to be overcharging for their services.

That said the recent announcement that SCAPE; the public sector procurement body, is to manage the new FM framework demonstrates that negative experiences such as the above have not disenfranchised the public sector in the outsourcing of their services.  Instead it has called for heightened policing in respect of the efficiency, quality and effectiveness of services provided.

This is encouraging news, not only for those service providers operating in the public sector but also in respect of the number of job opportunities that will occur in this area.  This hike in Facilities Management employment opportunities is twofold; not only has the public sector announced that they are likely to hire more staff directly but also due to the approval of public sector development such as HS2, this is likely to bring about more opportunities with service providers that have been approved to deliver such services.

The competition for public sector contracts is likely to soar due to the continued challenges that the public sector faces in respect of the quality and ability to deliver facilities management services as explored above.  The increased policing that will now be required within public sector contracts will heighten contract costs meaning regular providers of facilities management services to the public sector may no longer be able to compete.  This will then lead to increased interest from overseas organisations as this will present them an opportunity to gain a foothold in the UK facilities management marketplace.