PROCUREMENT
227. The public sector spends around £175 billion
every year purchasing goods and services from the private sector,
involving 30% of British companies. DWP states that public sector
procurement can therefore be a potentially powerful lever to drive
progress on equality. It states that under the existing public
sector equality duties, public bodies are already required, in
carrying out their procurement activities, to have due regard
to the need to eliminate unlawful discrimination and to promote
race, disability and gender equality.[278]
The Minister, Maria Eagle, said that the "use of our purchasing
power through public procurement will be a powerful lever."[279]
228. Cloisters state that experience under the Race
Relations Act demonstrates that more is needed generally to ensure
that public authorities, especially central government departments,
fully comply with their positive duty to promote equality. They
highlight the lack of evidence that public authorities do take
their race equality duty into account in the procurement process,
despite comprehensive guidance prepared by the Commission for
Racial Equality.[280]
229. The CBI argues that procurement can be an effective
lever to promote social objectives, but says that clarity about
the requirements placed on contractors is essential: "The
requirements need to strike a balance between 'making the public
pound work harder' and impinging on the private sector business
process: to do this", and added: "the requirements need
to be related to contract delivery not procedures."[281]
The Employer Forum on Age states: "Provided that appropriate
indicators of diversity performance are adopted (and that these
are not narrowly or prescriptively restricted to, for example,
the gender pay gap), we believe that substantial change in the
private sector will flow from an increased focus on equality and
diversity in public sector procurement from private sector suppliers."[282]
230. Ms Scott-Parker of the Employers' Forum on Disability
said: "I see four distinctly different categories
of activity under this. One is how does Government put its money
in by way of social enterprise - organisations that employ people
primarily with disabilities or other disadvantaged groups. [
]
Secondly, on the equality front, how do you determine whether
or not your supplier does share your values? [
] Third, I
mentioned earlier requiring the suppliers to prove they are disability-competent
would I think drive change in a much more powerful way. Prove
to us that the services you deliver enable people with disabilities.
[
] The fourth one we have not talked about is disabled entrepreneurs."[283]
231. The TUC cites a number of examples of good practice
on equality and public procurement in some parts of the UK. The
Northern Ireland Equality Commission and the Central Procurement
Directorate have jointly published guidance on equality and procurement,
with a number of good practice examples; West Midlands Local Authorities
have developed the West Midlands Common Standard, a common set
of questions that can be used at the pre-qualification stage to
get contractors to demonstrate that they comply with non-discrimination
requirements in employment legislation; GLA has adopted a Responsible
Procurement policy; Unison's local government branch in Newcastle
has reached an agreement with Newcastle City Council permitting
them to review tender documents and interview contract bidders
about level of service and proposed terms and conditions.[284]
232. However, the Federation of Small Businesses
(FSB) believes that using procurement as a way of improving disability
outcomes in the private sector is not a practical measure for
small firms.[285] Mr
Willman of the FSB argued that: "Small businesses are discriminated
against very heavily in the procurement process because the public
sector workers do not understand the smaller units of the micro-business.
You do not have policies because it is not a written procedure."[286]
The British Chamber of Commerce agree that "In these tough
economic times, the government's priority should be to make the
tendering process for public sector contracts easier for small
businesses. The Glover Review recognised that it is already difficult
for small firms to access the £160billion of public sector
contracts that are on offer each year. There is a danger that
these measures will make it even more difficult for small firms
to access these contracts."[287]
233. We believe
that procurement can be an effective lever to promote equality
objectives, but clarity about the requirements placed on contractors
is essential. We agree with the CBI that these requirements should
be related to contract delivery not procedures. This approach
would ensure that smaller firms stand an equal chance in meeting
the requirements, as it would benefit most those that can deliver
the required outcomes, rather than those with the most administrative
resources.
234. A number of submissions recommend that the new
legislation should make it explicit that the equality duty is
exercised in relation to procurement.[288]
The Disability Charities Consortium states: "A specific duty
around public procurement would send out a clear and unequivocal
message that public authorities can be held accountable if they
have not taken steps to ensure that contracted services or publicly
funded services are compliant with disability equality."[289]
This goes further than the Government's proposals which outline
a light-touch approach through encouraging greater transparency
and improving use of purchase power.
235. Age Concern and Help the Aged argue that: "whilst
we would welcome: 'clearer, consistent and practical guidance
on the legal and policy framework and the ways in which equality
can be factored into the various stages of the procurement process,
together with case studies and examples of good practice', we
do not think that this alone will be enough."[290]
Mr Harwood of the Public Interest Research Unit emphasised that:
"unless the definition of functions of a public nature is
made clear in the Equality Act, there is a danger that as more
and more public functions are contracted out the equality duties
will become of ever diminishing practical significance."[291]
236. The Minister, Maria Eagle, stressed that contracted
out services are covered by the public sector duties: "To
the extent that they are carrying out public functions they will
[be covered] in the same way as the public sector."[292]
However, the Discrimination Law Association emphasised that:
"Applying statutory equality duties to public
authorities using the definition of 'public authority' contained
in s.6 of the HRA 1998 will not necessarily bring a private or
voluntary sector body fully within the reach of the statutory
equality duties as such duties will apply to bodies that are not
'pure' public authorities ('hybrid authorities') only when they
are carrying out 'functions of a public nature' and only in respect
of such functions."[293]
237. The confusion that currently surrounds the definition
of 'public functions' within the Human Rights Act 1998 demonstrates
the need for clarity within the legislation on this issue. Mr
Harwood of Public Interest Research Unit argued that "there
needs to be a definition in the Act, such as along the lines of
the Joint Committee on Human Rights' definition in their inquiry
into the meaning of public authority, to make clear to people
such as the contractors that they are subject to that duty."[294]
The Discrimination Law Association added that "This appears
to be necessary to overcome the hesitation by public authorities,
which, in turn, is based in part on the extremely cautious approach
of the Office of Government Commerce (OGC) [
] to recognise
procurement as a 'function' of public authorities."[295]
238. A number of submissions confirmed that OGC guidance
has tended to emphasise the constraints of EU Procurement law
rather than positively stating what can be achieved on equality
through procurement.[296]
Ms Casserley of the Discrimination Law Association said that:
"because of the guidance that is sometimes put out and because
of the European Directive on procurement there is a fear that
if people use procurement to promote equality they will fall foul
of European legislation in some way and actually that is not the
case, you can be a lot more proactive about procurement."[297]
Mr Purton of the TUC agreed: "The guidance
that has been issued is extremely conservative in its interpretation
of the law and seems to have been designed in the past to deter
public sector organisations from procuring their supplies and
services from organisations employing disabled people. I am very,
very pleased to say that seems to be changing."[298]
239. DWP states that as part of OGC's procurement
policy and standards framework the Government recently set out
how social issues can be addressed through public sector purchasing:
"The OGC publication Buy and make a difference, provides
practical advice on this, with good-practice. The OGC will be
publishing a similar guide specifically on addressing equality
issues in procurement, including clarification of what the existing
public sector equality duties mean for public procurement."[299]
240. As more
and more public functions are contracted out to private and third
sector organisations, there is a concern that the equality duties
will become of ever diminishing practical significance. We believe
that there is a need for clarification in the forthcoming Bill
that private and third sector organisations carrying out public
functions need to fulfil the same requirements as public sector
organisations in terms of promoting equality and equality outcomes.
Any person or body acting on behalf of a public body should be
deemed to be exercising a public function. We also recommend that
the Bill should make it explicit that the equality duty must be
exercised in relation to procurement.
A duty on the private sector?
241. The TUC argues that there have been some welcome
advances in understanding and commitment among some larger private
sector employers of the DDA, but the single largest impediment
to the employment of disabled people remains employer discrimination,
especially where the issue is mental health. The TUC states that
"The current light-touch regime has not brought about a significant
increase in the employment of disabled people; advice is readily
available for those good practice organisations that are willing
to heed it."[300]
242. However, DWP states that the Government does
not think that an equality duty on the private sector is appropriate.[301]
The CBI argues that there is little evidence that the extension
of the duty to the private sector would be effective.[302]
Ms Scott-Parker of the Employers' Forum on Disability agreed:
"For me, it is too early in the sense that we still do not
have the evidence in the public sector. [
] We certainly
have some members who feel that their systems are sophisticated
enough. They would accept it. We have others saying, 'But does
it work?' Fundamentally, that is the question."[303]
Ms Williams of the CBI added: "I agree with
that. It is too early. [
] If it can be effective, we need
to make sure and be confident it works in the public sector before
committing the private sector to the same requirements."[304]
243. Age Concern and Help the Aged recognise that
placing a statutory equality duty on the private sector may cause
difficulties, but believe that it should be maintained as an option
if a voluntary standard proves ineffective.[305]
They highlight the fact that the private sector provides approximately
80% of all employment opportunities in the UK.[306]
244. The TUC argue that an equality duty for the
private and voluntary sectors would not have to exactly mirror
the public sector duties. It could be phased in, for example,
applying to large private sector organisations initially and just
to the employment function, rather than the goods and service
delivery functions.[307]
The Public and Commercial Services Union agrees: "Although
it might require a difference of approach, based on size and scale
of operations, in principle we see no reason why private sector
employers are any less able than those in the public sector to
develop similar approaches to equality and to document these."[308]
245. DWP states that the Government's ambition is
to bring about cultural change to tackle discrimination in the
private sector. It refers to case study evidence from research
that shows that the most important factor cited by employers and
service providers making adjustments for disabled people was that
'it was the right thing to do'.[309]
DWP states it has adopted a two-pronged approach through
the Employ ability initiative, challenging employer attitudes
(targeting SMEs on an area basis) and developing an employer-led
strategy to encourage employer ownership and leadership of this
agenda.[310] The Government
also announced its plans to develop, in partnership with EHRC,
an equality 'Kite Mark'. This will recognise employers who are
transparent about reporting their progress on equality.
246. The National AIDS Trust recognises the development
of this kite mark as a positive step, but are concerned that as
this is a voluntary scheme, those employers who have the worst
record on equality issues will not need to take any further steps.[311]
The FSB also have concerns that a 'Kite Mark' for employers would
automatically work against small firms who do not have the HR
expertise or resources to put into acquiring it.[312]
247. Citizen Advice states that there are a wide-range
of tools, which fall short of the statutory duty approach, including
fiscal incentives such as tax credits for 'good' diversity employers.
Such measures have been used to encourage employers to invest
in workforce development and management and could be used to bring
greater compliance with equality and discrimination legislation,
and broader public policy goals. They say that a key option for
consideration is the role of market regulators. The Equality Bill
should include a statutory role for EHRC in working with regulators,
and introduce equality and fairness indicators as part of their
regulatory criteria and functions (the model of co-regulation).[313]
248. We note
the Government's stated intention not to extend the duty on the
public sector to the private sector. We have to build on the experience
with the current duties first to make them work better in the
public sector before extending them to the private sector. However,
we believe that a duty on the private sector should be maintained
as an option if a voluntary standard proves ineffective. We recommend
that the Government keeps its policy under review, while considering
the outcomes of its assessment of the impact of the public sector
equality duty.
245 Ev 200 Back
246
Ev 201 Back
247
Q 90 Back
248
Ev 87 [TUC], Ev 60 [National AIDS Trust], Ev 93 [Disability Charities
Consortium], Ev 128 [RNID], Ev 173 [Terrence Higgins Trust], Ev
176 [Trade Union Disability Alliance] Back
249
Ev 169 Back
250
Q 90 Back
251
Q 24 Back
252
Q 21 Back
253
Q 57 Back
254
Ev 134 Back
255
Ev 135 Back
256
Ev 214 Back
257
Q 213 Back
258
Q 56 Back
259
Ev 201 Back
260
Q 20 Back
261
Disability Rights Commission Involvement and real equality
September 2007 and Disability Rights Commission/RADAR Case
study examples of disability equality duty best practice May
2007 Back
262
A. Nathwani et al. The Public Sector Equality Duties, Making
an impact Schneider Ross, 2007 Back
263
Equality and Human Rights Commission Making practice happen:
Practitioners' views on the most effective specific equality duties
January 2009 Back
264
Ev 153 Back
265
Q 20 Back
266
Q 20 Back
267
Q 22 Back
268
Q 21 Back
269
Ev 152 Back
270
Ev 86 Back
271
Q 21 Back
272
Ev 55 Back
273
Ev 56 Back
274
Ev 86 Back
275
Q 22 Back
276
Q 22 Back
277
Q 216 Back
278
Ev 202 [DWP] Back
279
Q 221 Back
280
Ev 119 Back
281
Ev 214 Back
282
Ev 124 Back
283
Q 154 Back
284
Ev 87 Back
285
Ev 106 Back
286
Q 152 Back
287
Ev 125 Back
288
Ev 119 [Cloisters], Ev 135 [Carers UK], Ev 128 [RNID], Ev 87 [TUC],
Ev 163 [Unison] and Ev 94 [DCC] Back
289
Ev 94 Back
290
Ev 103 Back
291
Q 101 Back
292
Q 222 Back
293
Ev 169 Back
294
Q 101 Back
295
Ev 170 Back
296
Ev 87 [TUC], Ev 119 [Cloisters], Ev 170 [Discrimination Law Association] Back
297
Q 25 Back
298
Q 100 Back
299
Ev 202 [DWP] Back
300
Ev 88 Back
301
Ev 202 [DWP] Back
302
Ev 214 Back
303
Q 155 Back
304
Q 155 Back
305
Ev 104 Back
306
Office of National Statistics, Public sector employment,
taken from HC Communities and Local Government Committee Equality,
Sixth Report of Session 2006-07 Back
307
Ev 88 Back
308
Ev 80 Back
309
DWP Research Report 410: Organisations' Responses to the Disability
Discrimination Act Back
310
Ev 203 Back
311
Ev 60 Back
312
Ev 106 Back
313
Ev 194 Back