§ Mr. Russell BrownTo ask the Chancellor of the Duchy of Lancaster when he will publish new guidance on market testing and contracting out; and if he will make a statement. [49326]
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§ Dr. David ClarkBetter Quality Services is published today.
It represents a major step towards fulfilling our promise of better public services for all our citizens, customers and taxpayers alike.
The guidance is in two documents—Better Quality Services: a Handbook on creating public/private partnerships through Market Testing and Contracting Out and Better Quality Services: Guidance for Senior Managers.
This is the guidance for central Government Departments, including their agencies and NDPBs, that I promised when I published the Government's 12 Guiding Principles in Using Market Testing and Contracting Out, 4 November 1997, Official Report, column 94.
Better Quality Services gives guidance on applying the 12 Guiding Principles. We aim to achieve better quality services for the customer at optimal cost to the taxpayer. Our pragmatic approach will apply competition as best suits the circumstances of each case. Departments should review all their services and activities over a five year period. All options should be considered on a case by case basis and Departments should use what works best.
In our consultations we were told that when market testing—an in-house team competing with external bidders—was used it was often used inappropriately, when a straight choice between internal restructuring and contracting out would have been better for customers, better for staff and better for taxpayers. Better Quality Services encourages Departments to make clear-cut decisions that take account of the degree of uncertainty for staff and the effect on morale of each option. In doing so, Departments should consult their staff and their representatives, and other stakeholders.
People are our key asset. When using contracting out, Departments should consider whether to specify that staff are to transfer to any new contractor—for example, to maintain expertise or on other grounds related to the service required. This will invoke the protection of the Transfer of Undertakings (Protection of Employment) Regulations 1981 (TUPE). Otherwise, on the basis of legal advice, Departments should say whether, in the circumstances, TUPE is considered likely to apply.
The Government are committed to competition. Better Quality Services covers procurement, contract management, retendering and insourcing, which must always have a very robust justification. The guidance stresses probity, communication and openness. Departments must always be able to justify their decisions.
Partnership is stressed in the guidance: between the public and the private sectors, with staff and their recognised representatives, and between different parts of the public sector.
Producing this guidance has involved all Government Departments, the Council of Civil Service Unions, the Confederation of British Industry, the Business Services Association, those involved in developing Best Value in local government, and those concerned with the NHS. I am very grateful for all their help. This has been an exciting partnership, which will continue so that, together, we can bring about better quality services.
337WBetter Quality Services has been placed in the libraries of the House. Copies have been sent to all who helped in producing the guidance, including the Council of Civil Service Unions, the Confederation of British Industry and the Business Services Association. The guidance will be on sale in bookshops and can be accessed on the Internet under "Key Policy Areas for Cabinet Office (OPS)" on the Cabinet Office web site: http://www.open.gov.uk/co/cohome.htm.