Briefing: Delivering sustainable development through procurement

This briefing aims to communicate the key messages from the UK Government's sustainable procurement action plan (SPAP) published in March 2007. It builds on a speech presented at the Institution of Civil Engineers sustainable procurement conference on 7 February 2007.

The SPAP is the result of a process that began with the UK Government's strategy for sustainable development, Securing the Future, published in 2005.1 This set out the ambition for the UK to be among the leaders in the EU on sustainable procurement. Procuring the Future, published a year later, set out a series of recommendations for UK Government to achieve that goal.2 The action plan, along with sustainable operations targets for the Government's estate, presents a package of actions to deliver the step change required to ensure government supply chains and public services are low carbon, low waste, water efficient, respect biodiversity and deliver our wider sustainable development goals.

If everyone on Earth consumed natural resources at the same rate as the UK, we would need three planets to support us. We have to return to what the World Wildlife Fund (WWF) calls ‘one planet living’—a concept that has to be central to everything we do as governments, businesses and individuals. If we are to tackle climate change successfully, the industrialised world has to make some major changes; this requires both leadership and action.

The UK Government is trying to drive this agenda forward, not just through policy decisions but also through initiatives such as the SPAP. By demonstrating leadership at home we will be in a stronger position to encourage other countries to follow: tackling climate change is a global issue.

The UK Government is working hard to use its purchasing power (around £150 billion per year) to drive progress in sustainable development. The SPAP will help Government take action through its policies, performance frameworks and procurement practice. Government will be looking to work with its suppliers to provide innovative eco-technologies and solutions.

As such, the action plan and subsequent work involved to deliver its commitments aim to make rapid progress in key areas, for example reducing the carbon footprint of government activities, using government procurement power as an enabler, transforming markets for innovative and sustainable solutions, and creating more strategic procurement practices across the whole government. Government departments will focus on increasing the level of procurement professionalism and raising the status and standard of procurement practice to help achieve our targets for sustainable operations on the UK Government estate.

Alongside the measures set out in Transforming Government Procurement,3 action will be taken in eight key areas.

• Comprehensive spending review. A new set of public service agreements reflecting the principles of sustainable development will be agreed.

• Priorities and future plans. Our current sustainable procurement policy priorities have been clarified through a sustainable procurement policy framework.

• Strengthening leadership by clarifying accountabilities and roles throughout Government, as well as making sure that appropriate performance objectives and incentives for staff are put in place.

• Budgeting and accounting practice will be reviewed in order to improve departmental practice by the promotion of greater compliance with existing Government policy on value for money.

• Building capacity across departments by working with the National School for Government and the Chartered Institute of Purchasing and Supply (CIPS), and using the flexible framework and OGC's procurement capability reviews to increase professional procurement capacity.

• Raising standards through improving departmental compliance with agreed mandatory standards, including greater use of pan-government collaborative procurement, extending the existing ‘quick-wins’ standards and using only legal and sustainable timber (see section 5) on the Government estate.

• Market engagement and capturing innovation. The Department for Trade and Industry (DTI) is leading cross-government work on how public procurement can more effectively stimulate innovation as part of its forward policy programme.

• Scrutiny and reporting. The Sustainable Development Commission (SDC) will report on departmental progress through the inclusion of sustainable procurement commitments from the SPAP into annual Sustainable Development in Government (SDiG) reports and in its scrutiny of departmental sustainable development action plans (SDAPs).

Procurement is not just about products or materials. It also concerns suppliers and the services they provide when delivering and maintaining contracts and projects. The SPAP means that government departments will increasingly need to look for solutions that help them meet sustainable operations targets and that comply with an updated set of mandatory environmental product standards. Departments will seek out innovative solutions and approaches to procurement through early engagement with the marketplace and the use of outcome-based specifications. Strategic engagement with key sectors will help drive local carbon-efficient supply chains.

There are thus huge business opportunities for those companies who plan today for the needs of tomorrow. Government needs to take account of the whole life cycle of a product before making accurate decisions on what it actually costs. A commodity might appear cheap at the point of sale, but what are the costs to the environment of acquiring the raw materials that made it? What are the energy costs of processing it? What are the costs of disposing of it at the end of its useful life? All these questions must be considered.

Procurement is central to delivering the UK's sustainable development strategy and it is critical in helping the UK Government demonstrate to the private sector that we mean business. This has already begun and work on setting public procurement standards for timber is a good example of the UK Government acting as a world leader. Timber from legal sources is already a standard condition of UK Government contracts. However, sustainable timber sources are also necessary, so preference is given to suppliers that offer timber products that have been independently verified as coming from well-managed forests. From 1 April 2009 only timber and timber products originating either from independently verified legal and sustainable sources or from a licensed FLEGT (Forest Law Enforcement, Governance and Trade) partner will be accepted for use on the Government estate; appropriate documentation will be required to prove their origin. From 1 April 2015, only legal and sustainable timber will be accepted. Buying timber from unverified sources encourages illegal logging, which destroys biodiversity and the livelihoods of forest communities. To help public bodies procure timber responsibly, the Department for Environment, Food and Rural Affairs (Defra) has created the Central Point of Expertise on Timber to advise buyers and their suppliers.

This example shows how crucial it is that governments take action. Procurement can help promote sustainable behaviour as well as kick start innovation and investment in sustainable goods and services. Ultimately, sustainability must become second nature and the commitments laid out in the SPAP can help achieve this behavioural change. A central message from the SPAP is that sustainable procurement, smart procurement and good procurement are one and the same. Furthermore, it provides a direct route to delivering the UK Government's sustainable development goals.