Local government awarded £6.2bn worth of contracts this quarter, according to the latest quarterly report from public procurement experts Tussell. Home care and waste management were particularly hot topics, the data revealed, and London based authorities have increased investment. Balfour Beatty won the largest contract and East Sussex County Council was the biggest buyer.
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The Market
While local government has awarded over £6bn worth of contracts this quarter, once this is broken down by region it is clear that London-based contracting authorities awarded the most. Collectively, councils in this region awarded £1.4bn in total contract value. As noted, the quarter also saw a rise in home care contracts and waste management. But the largest contract of the quarter went to Balfour Beatty for Highways Infrastructure Services. This continued the trend of construction as the dominant sector, making up 36% of the market.
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Waste Management
Veolia was a key supplier to local government this quarter as it won two contracts with London-based authorities. Both contracts, awarded by the boroughs of Brent and Hammersmith & Fulham, were for waste collection and street cleansing. At £273m and £146m respectively, these are the largest waste management contracts ever awarded by these authorities. They are following in the footsteps of the London Borough of Croydon who awarded similar contracts to Veolia back in 2017. Similarly, other councils who are looking to improve their waste management services may look towards Veolia as a trusted supplier.
Home Care
Home care contracts were prevalent among the highest value awards this quarter. Agincare won a £140m contract with the London Borough of Southwark for the provision of residential and nursing care for older people. This was one of Agincare's largest contracts with the public sector. Outside of the capital, Staffordshire County Council awarded a £205m home care contract to 10 small suppliers. This included services to give home carers respite to help support their mental health. As home care becomes a more salient topic, local authorities can identify the key social care suppliers within their region to maximise efficiency within their procurement process.
Local Spending and SMEs
Balfour Beatty's contract with East Sussex County Council led to a concentration in local spending within the South East. Seventy percent of total contract award value went to local suppliers in this region. In contrast, the North East awarded just 23% locally.
Northern Ireland continued its trend of high local spending as nearly 100% of contracts went to suppliers from within the region. Further analysing social value, contracting authorities within the West Midlands performed well. Fifty-four percent of contract award value went to SMEs while local suppliers won 46% of total value.
Analysing which suppliers within each region are winning contracts can help local authorities identify local companies to procure from. Similar strategies can be employed to identify SMEs to target in order to promote social value within the procurement supply chain.
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