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UK Public Procurement of Innovation: The UK Case

Abstract

This chapter provides a review and assessment of public procurement of innovation in the UK. Public procurement of innovation has long been of significant policy and research interest in the UK, but particularly so in the last decade. Accordingly, a host of initiatives and reports have been introduced aimed at mobilising the use of UK public procurement to support competitiveness and innovation. Despite conflicting objectives in procurement policy and a recent shift in focus towards efficiency in government spending and away from innovation, the UK case has been widely used as an international exemplar. The chapter is structured as follows: First, the context for the wider practice and governance of public procurement in the UK is introduced, including broad statistical evidence of the breadth of public procurement expenditure in the UK. Against this background, we provide a description of key policy initiatives designed to embed public procurement in the innovation policy portfolio of the UK. As examples, we provide some short case studies to explore the reach and limitations of the policy approaches and instruments used. We finally provide some conclusions about the recent development and foreseeable future use of innovation procurement in the UK. In particular, we question the level of dissemination and impact of some of these measures.

Keywords

  • National Health Service
  • Public Procurement
  • Small Business Innovation Research
  • Government Procurement
  • Procurement Process

These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

  1. 1.

    The Public Services Industry is defined as ‘All private and third sector enterprises that provide services to the public on behalf of Government or to the Government itself’ (Julius 2008: i).

  2. 2.

    Unless otherwise indicated, the chapter will concentrate on public procurement in UK central government, (English) local government and (English) National Health Service.

  3. 3.

    In 2010 there had been plans to disband the Audit Commission, however, as of summer 2012 it still was in operation, and discussions were still underway http://www.audit-commission.gov.uk/aboutus/future/Pages/default.aspx (accessed July 2012).

  4. 4.

    we are grateful to Colin Cram for this comment.

  5. 5.

    Improving access by small and medium-sized enterprises (SMEs) to procurement contracts was also the focus of the Better Regulation Task Force/Small Business Council Report ‘Government: Supporter or Customer?’ in 2003, which was taken up by the DTI and the OGC.

  6. 6.

    Cabinet Office, Government Appoints Chief Procurement Office to Cut Waste, 19 April 2011; Cabinet Office, Supplier Representatives to Cut Costs for Government, 13 April 2011.

  7. 7.

    ‘Science, Innovation and the Economy’, 9 July 2010, Royal Institution, London.

  8. 8.

    The role of science, research and innovation in creating growth, By Vince Cable, 8 September 2010, Queen Mary University of London.

  9. 9.

    In July 2011, an announcement was made that more than 1,400 jobs were to be cut at Bombardier, the UK’s last train manufacturing plant, in Derby. Job losses were announced after Bombardier lost the £3 billion contract to supply 1,200 carriages for the Thameslink route, a contract that was won by Siemens of Germany.

  10. 10.

    By Vince Cable, Secretary of State, 26 October 2011, The Ideas Space, Policy Exchange, 10 Storey's Gate, Westminster, London, SW1P 3AY.

  11. 11.

    The UK model, in contrast for example to the model used in the Netherlands, did not apply SBRI for the purpose of technology transfer and the application of emerging technology, see EU Commission 2010: 8–9.

  12. 12.

    Interview TSB.

  13. 13.

    For more details, see: http://www.bis.gov.uk/assets/biscore/corporate/migratedd/publications/c/cs02_hmps.pdf.

  14. 14.

    Including the pilot cases conducted in the context of the EU project LCB-Healthcare as part of the EU Lead Market Initiative, in partnership with nine hospitals across Europe (European Commission 2012).

  15. 15.

    See http://www.cpsl.cam.ac.uk/Leaders-Groups/The-Prince-of-Wales-Corporate-Leaders-Group-on-Climate-Change/UK-Procurement.aspx.

  16. 16.

    In the industrial strategy of the UK Coalition government public procurement that is based on the Innovation and Research Strategy for Growth public procurement is still one of the key pillars, but with less emphasis on innovation, and more emphasis on the attempts to better use public procurement for economic effects more generally, shaping markets and supporting supply chains within the UK. http://www.bis.gov.uk/news/speeches/vince-cable-industrial-strategy-september-2012, Accessed 25 October 2012.

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Acknowledgements

Research for this chapter was funded by the UK Economic and Social Research Council Grant R111539 with contributed support from the Department of Business Innovation and Skills, NESTA and the Technology Strategy Board. The authors would like to acknowledge their generous support. We would also like to thank Colin Cram and Sue Creese for their feedback on earlier drafts.

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Correspondence to Elvira Uyarra .

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Uyarra, E., Edler, J., Gee, S., Georghiou, L., Yeow, J. (2014). UK. In: Lember, V., Kattel, R., Kalvet, T. (eds) Public Procurement, Innovation and Policy. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-40258-6_12

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