Public Health Scotland procurement strategy 2020–23 1 Note: In line with the Reform Act and to ensure our annual procurement report details our performance against the strategy, this strategy will be subject to formal annual review. This will take account of any changes to organisational objectives and in NHS and Scottish Government policies and strategies. Strategy owner: Kris Lindsay, Procurement Manager Email: [email protected] Telephone: 0131 275 7454 Citation: Lindsay K. Public Health Scotland procurement strategy 2020–23. Edinburgh: Public Health Scotland; 2021. Contents Definition Glossary ..................................................................................................................... 2 Introduction ................................................................................................................ 4 Procurement vision/mission statement ....................................................................... 4 Strategy rationale ....................................................................................................... 5 Strategic aims, objectives and key priorities ............................................................... 6 Mandatory obligations .............................................................................................. 11 Engaging with suppliers ........................................................................................... 12 Monitoring, reviewing and reporting ......................................................................... 16 1 Glossary Category: A collection of similar commodities grouped together to support category management. European Single Procurement Document (ESPD): A single common document intended, by the European Commission, to reduce the administrative burden on bidders and remove some of the barriers to participation in public procurement, especially for small- to medium-sized enterprises. Ethical procurement: Ethics in purchasing and supply management can relate to a wide range of issues from supplier business procedures and practices to corruption. The common areas relate to ethics and ethical behaviour in companies include fair-trade, ethical trading, ethical sourcing, social accountability, social auditing, corporate social responsibility, corporate citizenship, codes of conduct and reputation assurance. Supported business: An establishment where more than 50% of the workers are disabled people who, by reason of the nature or severity of their disability, are unable to take up work in the open labour market. Standing financial instructions: This details the financial responsibilities, policies and procedures adopted by NHS National Services Scotland (NSS). They are designed to ensure that financial transactions are carried out in accordance with the law and government policy to achieve probity and accuracy. Whole-life costing: A technique used to establish the total cost of purchasing and ownership. It is a structured approach which addresses all the elements of cost and can be used to produce a spend profile of the product over its anticipated lifespan. Circular economy: An alternative to a traditional linear economy (make, use, dispose) in which we keep resources in use for as long as possible, extract the maximum value from them while in use, then recover and regenerate products and materials at the end of each service life. 2 Community benefits: Requirements that deliver wider benefits in addition to the core purpose of a contract. These can relate to social, economic and/or environmental benefits. Small- and medium-sized enterprises: Enterprises that employ fewer than 250 people and have an annual turnover not exceeding €50 million, and/or an annual balance sheet total not exceeding €43 million. 3 Introduction On 1 April 2020, a new public health body, Public Health Scotland (PHS), was created. This new public health body provides national leadership to improve and protect the health and wellbeing of the people of Scotland and tackle persistent health inequalities that impact many of our communities. This strategy sets out the procurement objectives of PHS over the period of 2020–2023. It takes full ownership of the responsibilities placed on Scottish public sector bodies by the latest procurement regulations and offers a clear pathway to balancing value for money while using our financial resource to support Scotland’s health. This will be done in a way which is environmentally and ethically responsible. Taking responsibility for the delivery of the objectives and goals within this strategy rests not only within the procurement team but also across our entire workforce. Only through effective collaboration and collective responsibility across every individual PHS colleague will we demonstrate the value that excellent procurement can deliver. It is anticipated that this strategy will evolve and adapt to the changing needs of PHS as the organisation develops. Procurement vision/mission statement PHS procurement vision To be recognised as a value added procurement function, fully aligned to PHS organisational objectives and delivering the best value for all stakeholders. PHS procurement mission To provide outstanding procurement within PHS which supports the ambitions of the organisation in the most efficient, cost-effective and compliant manner. 4 Strategy rationale Overview The Procurement Reform (Scotland) Act 2014 requires any public organisation that has an estimated annual regulated spend of £5 million or more (excluding VAT) to develop and review a procurement strategy annually before the start of the next financial year. This procurement strategy sets out how the organisation intends to carry out its regulated procurements, that is, procurements with an estimated value equal to or greater than £50,000 (excluding VAT) for goods and services, or £2,000,000 (excluding VAT) for a public works contract. PHS procurement structure Scottish public sector procurement operates under the following legislative framework: • European Treaties and Directives • The Procurement Reform (Scotland) Act 2014 • The Public Contracts (Scotland) Regulations 2015 • The Procurement (Scotland) Regulations 2016. The interpretation and implementation of this legislative framework is influenced by substantial case law from across the United Kingdom and Europe, making this a constantly evolving area to operate in. The legislation is reflected within the PHS standing financial instructions relating to contracts and corporate procurement guidance. The PHS procurement strategy operates on a rolling three-year period and is refreshed annually. This strategy covers the period from 2020–2023. 5 Strategic aims, objectives and key priorities Organisational values PHS values, which are reflected throughout this strategy, are: • respect • integrity • collaboration • excellence • innovation. Procurement strategic objectives Objective 1: Embed ethical and sustainable procurement excellence across PHS Goals • To champion, support and promote the benefits of sustainable procurement. This includes supporting the transition to a circular economy, applying whole-life costing, early supplier involvement, and encouraging innovative products and solutions. • To be compliant with the Reform Act, and the general and specific duties it imposes on Scottish authorities, including the sustainable procurement duty. • To embed sustainability in procurements in a relevant and proportionate manner, as required by the Reform Act, and to provide best value and secure wider social, economic and environmental benefits. • To promote and support PHS’s strategic objectives, key priorities and policies. • Embed ethical procurement into PHS’s procurement processes. • Follow the principle of ‘fair work first’ in our approach to contracting, and include this requirement in the majority of our procurement exercises. 6 Target areas • Use the Scottish Government’s sustainable procurement tools (a sustainability test) within all regulated procurement activity, including the prioritisation tool to prioritise and focus on those commodities/categories of spend. • Work within PHS’s sustainability programme structures to promote visibility of the sustainable procurement duty to colleagues and need for action. • Make it easy for medium, small and micro suppliers to work with PHS by providing easier access to contracting opportunities. • Use supported businesses as much as possible. • Look to promote opportunities with third sector organisations where possible. • Collaborate, where possible, with other public sector organisations on contract opportunities and knowledge-sharing to drive improvements in sustainable and ethical procurement. • Work with our supply base to encourage the implementation of the Scottish Living Wage. Planned outcomes • Identified risk and opportunities. • Compliance with the sustainable procurement duty. • Improved accessibility to contracts for small- and medium-sized enterprises, social enterprises and the third sector. • Reduced environmental harm from our supply chain. • Demonstrable and measurable sustainable outcomes. • Achieve Scottish Living Wage accreditation for PHS. • Work with PHS colleagues to develop a community benefit ‘demand’ register. 7 Objective 2: Compliance and governance Goals • Uphold the integrity of PHS by ensuring full compliance with the procurement regulations and the Reform Act. • Promote and drive compliance with PHS standing financial instructions. • Make the best use of the regulations to achieve optimal value. Target