The following article from CECA Wales was published by the Nation Cymru platform Making the Welsh pound go further! but, in case you missed it, it’s here in its entirety.
Making the Welsh pound go further!
If you hadn’t noticed, we have a new government in Wales. There is also a new prime minister in Westminster. Changes all around. New people, new ideas, new priorities? However, what isn’t changing anytime soon is how much money we/they have to play with. The magic money tree has gone, if it ever existed!
So, what do we do?
Aside from the obvious calls for fair funding for Wales and, in particular, devolution of the rail network and the funding that goes with it, it’s unlikely that we’re going to see vast sums of money pouring in to Wales. This reality should focus minds on what we can and should do with the money we have. We need to make it work so much harder for us. And we can. But not if we keep doing the same old things in the same old ways. And this is where the public sector need to step up.
We keep hearing about “Together, Stronger”, small country, agile, blah, blah. We talk a good talk. We rarely walk the walk as well as we think we do. We must do better.
Take infrastructure. If we want to grow a stronger economy, if we want to get more people into employment, if we want a more productive workforce and if we want a better future for the next generations, we must invest in infrastructure. But how we spend on it is almost as important as what we spend it on.
The Welsh Government spends about £1bn per annum on public sector infrastructure projects. This figure increases when you consider specific major “one-off” projects, UK Government projects in Wales and a growing spend by the private sector, particularly in the energy, water and marine sectors. That’s a lot of money which, if spent wisely, should contribute much more than just the infrastructure itself.
Plaid Cymru came into government talking about growing Welsh businesses, increasing the social value that we get from investments, reviewing the skills needed for the C21st and using the public procurement process to keep as much of the Welsh pound in Wales as possible. All of these things are welcome. Andy Burnham also came into power with great ambitions for change too. Both face considerable fiscal challenges so must make the money go further. And, as a trade body representing civil engineering contractors, the people who build our infrastructure, we called for a number of things in our CECA Policy Asks report earlier this year and it’s good to see some of these things reflected in the “narrative” of the political parties who can actually do something about it. And that’s where things have gone awry in the past!
So, how do we make sure that the billions of pounds that are spent on infrastructure, much of it through small but regular projects, really does give maximum value? What can governments do to make it better? Well, if you’re not into infrastructure then I’m afraid this is where it can get a little bit boring, but the devil is in the detail so please bear with me just a little!
Plan better and tell industry what work is ahead of them.
If a business knows what opportunities are ahead, they can plan ahead. They can plan, with greater certainty, to invest in new and modern machinery. They can plan to take on more apprentices, with greater certainty. They can invest in the skills of their workforce. And they can plan for the growth of their business.
But the public sector hasn’t been great in sharing it’s plans, even though it has this data. It just needs to share it with its supply chains. It’s called partnership and if you want to support your partners and get the best value out of them, then you’ll do this. It doesn’t happen well now and maybe that tells you all you need to know about the relationship?! This needs to change.
Streamline conflicting policies, regulations and legislation.
We often hear people say “Why can’t we build things quickly in the UK, just like they do in China?”. Well it has little to do with engineering capabilities which we have in abundance. It has a lot to do with the tangled web of conflicting policies, regulations and legislation which stifles progress on delivering new infrastructure. I wouldn’t advocate removing it all because much of it is there for good reason but it’s a mess and needs to be streamlined. Perhaps we need a “quick and dirty” commission, similar to what Plaid Cymru has instigated in the agricultural sector to remove unnecessary bureaucracy?
Give the public sector multi-year funding certainty.
The public sector, and local authorities in particular, are severely constrained in the way they deliver infrastructure projects by a funding process which only gives them funding over a 12 month period starting in April. Yes they could do things to manage this better but even then there are limitations. We’ve all experienced “mad March” when council’s are desperately trying to get money “out of the door” before April and we end up with roadworks all over the place as they desperately try to fill potholes. That’s not great for the private sector contractors either, who often have to bring in labour from elsewhere just to meet this spike in demand. The Plaid Cymru led Welsh Government have just announced multi-year SFS payments to farmers so that they can manage their businesses with greater certainty. Can’t we do this for local authorities too, so that their supply chain can also manage their businesses with greater certainty?
Address culture and behaviours in public sector procurement.
Ask private sector suppliers, who depend on public sector contracts for a significant part of their turnover, what their top frustrations are and I’m pretty sure that the word “procurement” will crop up! Which is a shame, given that the whole public procurement “machinery” should be an enabler for not just buying things but helping local businesses to grow, supporting people into jobs and apprenticeships, supporting businesses to innovate and get better, tackling net zero challenges and supporting local communities by increasing social value. All these things should be a given and we have “encyclopaedias” full of policies, regulations, legislation and guidance telling the public sector to do this. So, why do so many public sector procurers just pass these “requirements” on to private sector suppliers in a cold and transactional way and then expect them to do “stuff” for the lowest price?! We have too much bureaucracy and nonsense in this field when what we need is a culture change and behaviours that reflect a supportive and “can do” mentality where both public and private sectors want to do better.
This last item is the thing that will make the greatest difference in “making the Welsh pound go further”, not just in the infrastructure sector but across just about every sector in Wales. Unfortunately, it’s the one area which is proving incredibly resistant to change but one in which the new Welsh Government, supported by those other public bodies who receive our funds, must make an impact if we’re to make the Welsh pound go further.
Ed Evans, Director, Civil Engineering Contractors Association (CECA) Wales