Press release

Cabinet Office work to “shop” poor procurement work and boost SMEs sees over 300 complaints investigated

More than 300 complaints have been investigated through Cabinet Office's Mystery Shopper initiative, which tackles bad procurement practice.

19 December 2012

In the 18 months since its launch, over 300 complaints have been investigated through Mystery Shopper - a Cabinet Office initiative that asks businesses to ‘shop’ bad public procurement practice. The service which allows businesses to complain about practice both across central government and the wider public sector has helped deliver positive changes in around 4 out of 5 cases Cabinet Office Parliamentary Secretary Chloe Smith announced today.

The Mystery Shopper’s first progress report shows:

  • 80% of all cases raised issues with the procurement process, with a number of SMEs concerned about unachievable pre-qualification financial requirements and the lack of early market engagement.
  • In 38% of concerns about the procurement process, SMEs cited lengthy and complex pre-qualification questionnaires (PQQs) which disadvantage smaller businesses by setting too much emphasis on financial guarantees and requirements.

Cabinet Office Parliamentary Secretary Chloe Smith said:

In the past the playing field was stacked against SMEs winning public sector contracts and public procurement seemed as if it was designed to serve the needs of procureaucrats not business. This government is determined to change all that and to strip out unnecessary process from public procurement. We have made good progress already but there’s still a long way to go and in this global race our businesses need all the help they can get.

Mystery Shopper is one piece of our wider reform programme. It allows us to make sure that our work to reform central government procurement is as effective as we want it to be. And - although we can’t always directly deal with poor practice in the wider public sector - it’s great news that in four out of five cases investigated, the scheme has improved things.

Mystery Shopper gives SMEs a chance to have their voices heard anonymously and to raise concerns about the bureaucratic barriers which stand in their way. Stripping these out will make a difference to business, and to the growth of our economy.

We want more businesses to use this service to raise complaints so we can name and shame the parts of the public sector still doing procurement in the clunky old-style.

Mike Cherry, National Policy Chairman at the Federation of Small Businesses said:

SMEs represent 99% of all businesses yet a survey of our members suggests that around 70 per cent of them rarely or never bid for government procurement opportunities. As such we welcome these efforts by the Cabinet Office to tackle procurement practices and allow SMEs to deliver value for taxpayers. I would encourage all SMEs to use the Mystery Shopper scheme to report problems with public sector procurement.

Available today on YouTube is a short video of Sally Collier, Government Deputy Chief Procurement Officer, talking about the Cabinet Office Mystery Shopper scheme and why it is so important for suppliers to report bad procurements.

Watch video of Sally Collier.

The Mystery Shopper scheme has made real changes to how public sector procurements are carried out. For example, after the Cabinet Office raised concerns about excessive insurance requirements with the British Council, they reduced the required insurance levels on the contract in question for the complainant and other suppliers by between 50 per cent and 90 per cent. Imperial College Healthcare settled the outstanding invoices of two small suppliers that had not been paid on time and committed to tighten their internal processes to ensure that the problems did not recur, while Eastern Shires Purchasing Organisation (ESPO) has implemented a pre-market engagement process to ensure a more informed, shorter and smoother procurement process.

Notes to editors

Read The first Mystery Shopper Service progress report: Trends from the first 18 months

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