A lack of Government procurement know-how is putting major projects at risk and costing the tax payer dearly.
The Government's spending watchdog, the National Audit Office, warned that the value for money of 43 major government projects worth around £200 billion is at risk because of significant weaknesses in the Government’s commercial skills and expertise.
The NAO report published today warned that in one instance an outside consultant was paid £1.35m over three years to plug the skills gap in the Building Schools for the Future programme. Meanwhile, the Highways Agency spent £15.5m on advisers – five times its original budget.
The biggest skills gaps for Government are in contract management, commissioning and managing advisers, risk identification and management, and business acumen.
ADVERTISEMENTGovernment efficiency department, the OGC, spent ВЈ6.7m last year trying to tackle the skills problem. It was criticised for duplicating initiatives.
Amyas Morse, head of the NAO, said "Commercial skills are essential to success in complex projects and a great deal of money rests on this.
"But there is still not a coherent system for providing skills across government or for using the existing skills as efficiently as possible."
The report warns that Government departments continue to experience a shortage of staff with the commercial skills and experience needed to design and deliver complex projects successfully.
A 2009 review by the Office of Government Commerce (OGC) found that 44% of senior responsible owners of major projects did not have any substantial commercial experience.
The NAO said that 14 of 16 departmental commercial directors believed the OGC had done little to address skills gaps within their department.
The OGC has introduced a number of initiatives aimed at improving commercial skills, such as Building the procurement profession in government. But the report found that the OGC and departments were not working together effectively and new measures have had limited impact.
As a result, the value for money of the ВЈ1.5 million a year that OGC has been spending on initiatives is at risk. OGC needs to work with departments to establish standard approaches to dealing with the commercial sector.
The culture of staff frequently moving positions within a department often leads to commercial experience and expertise being lost by projects and by individuals.
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