The value of being big

Roused from my post-Christmas torpor by today’s news that government is asking ad agencies to work for nothing, and that KPMG is offering Whitehall free work on potentially multi-million pound contracts.

Lest we are overwhelmed by KPMG’s public-spiritedness (government now comes under their CSR agenda apparently, bless), it should be pointed out that this is a time-limited offer.  What they appear to be doing is paying to have their feet under the table at the point when programmes are ready to be delivered, so they can exploit their incumbent’s status to keep the work rolling in future, when I doubt it will be on such generous rates.  This makes good business sense for KPMG.  There is, of course,  no small business in the country that could afford to do the same.  It’s a game only the big boys can play.

I drafted what follows  before Christmas but didn’t post it because the blog already felt depressing enough.  Feeling stronger now, so here goes:

At the moment, whenever two or more freelancers are gathered together there are a couple of standard rumours under discussion: that there still might be bits of work commissioned in the new year on the old spend-the-money-that’s-left-before-the-next-financial-year-starts pattern;  that there might be work of a rather ghoulish nature, managing the closing down of  quangos; that the scale of change being introduced could mean that work will have to be commissioned to smooth transition  in the public services.  The subtext to it all is, of course, simply “I REALLY want them to start spending money again.”

“They” won’t of course – and the other common topic of conversation is that even if they did the money would go to one of the big four consultancy houses  and the little fish won’t get a sniff of it.  Government commitments to help small business sound a bit hollow out here in consultancy land.  As the giant companies with the big bags of swag contracts go through the process of renegotiating their agreements with government, smaller shops are going under at a frightening rate. 

Here’s something else that was written before Christmas – BIS‘s paper on backing small business

 This new strategy demands a relentless focus on the needs of small and medium sized businesses. They provide nearly 60% of our jobs and 50% of GDP. They will benefit from the measures we are taking across the whole economy but Government is clear that they have specific needs and can be disproportionately burdened by poor Government policy. This has not been sufficiently reflected in Government’s attitude or orientation over the last decade. This Government is committed to a comprehensive effort to prioritise small businesses and those that run or aspire to run them.
Thanks for that. 

2 responses to “The value of being big

  1. Sadly, Government policy and government procurement practice are all too often completely different things. They never seem to grasp the example they could set.
    The construction industry representative bodies spent years pressing the previous Government to insist on specific health and safety standards in the contracts they awarded for schools, hospitals and other publicly funded buildings. The Office of Government Commerce paid lip service to the idea, but never followed it through.
    Similarly, DEFRA developed a policy for requiring evidence that timber used in government building projects was from sustainably-managed forests, but then had to try to persuade other departments to take it up. They couldn’t even force DEFRA procurement managers to adopt it.
    What a contrast to the Olympics, which, although publicly funded, operates outside the government sphere. The Olmpic Delivery Authority has taken it upon itself to use its power and prestige to show what could be done if given the opportunity, and (surprise, surprise) the major developers (M&S, Sainsbury’s, Tesco et al) are desperate to learn the lessons.
    Oh, and one of those lessons is how you can write into the contract with a major contractor that they have to source a minimum number of sub-contracts from small businesses, and that they have to write that condition into their supplier contracts as well.

  2. You are quite right, Penny.

    This KPMG debacle is a classic case of a government talking total bullshit.

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