How is procurement organised in the FCO?
As the FCO is a global organisation the procurement organisation has been set up to reflect its procurement activity and spend which is split between its UK centre and approximately 200 embassies spread throughout the world. The main procurement function, the Corporate Procurement Group (CPG), is centrally located in London, with some elements managed in its Milton Keynes office.
The FCO has recently adopted a category management approach to all its procurement activity, with category teams supporting key business areas to effectively manage the procurement demands in a strategic and coordinated way.
As such the FCO operates mainly as a centrally led organisation, but with certain delegated procurement activities given to overseas Posts so as to allow them to effectively manage their day to day local needs.
CPG is the custodian of the FCO Policy Framework for Public Procurement, and oversees the FCO’s Procurement Strategy. Its operational category teams are involved in strategically managing FCO procurement to meet the needs of FCO stakeholders both in the UK and overseas, with involvement in all contracts of significant value or complexity (generally above a whole life contract value of £80,000).
How do we operate?
We buy goods, services and works based on best value for money for the taxpayer.
- we work using competitive tendering
- we manage procurement in a responsible manner recognising the importance of ethics and professionalism
- we comply with our legal and international obligations, including the provisions of the EU Procurement Directives.
Some of FCO’s mission critical services are provided by FCO Services a trading organisation of FCO. Beyond these arrangements, our UK departments and Posts overseas have the discretion and budgets to buy what they need in line with CPG policy and guidance.
Principles and Policy of Procurement
Like all UK public bodies the FCO is subject to a legal and policy framework of public sector procurement. These set out a range of obligations and expectations in how we undertake our procurement, based upon the principles of value for money best realised through effective open and fair competition.,
What is Procurement?
Procurement is the process of acquiring goods, services or works from third parties in a way that maximises value for money. It covers all activities from the identification and justification for a need through to the end of contract and / or disposal of goods. Value for money is the best overall balance of quality and whole-life costs to meet the FCO’s and its customers requirements and to clearly demonstrate proper use of public funds.
In practical terms, for each proposal, quotation or formal tender received from an interested supplier the FCO must, in order to satisfy it is getting best VfM, evaluate and compare the:
- quality of the offering (which might include, for example, the date for delivery, the skills of the contractor’s staff, their approach) as well as;
- the whole-life cost (including, for example, the cost of consumables, training, utilities, licences, disposal) over the life of the contract or asset.
Any key procurement decisions (such as the competition approach, engagement with suppliers or the contract award criteria) must be undertaken ethically and responsibly in accordance with UK Public Sector Procurement Policy and Legal requirements which include EU Procurement Regulations that set out the principles of fair and open competition.
The FCO like all public bodies has set out the behaviour it expects of its staff in codes of conduct. As well as providing minimum procedural requirements in procurement activities they will also provide the foundation for ethical procurement behaviour. All staff or contractors, advisers or consultants working on behalf of the FCO have a duty to act in a professional, appropriate and ethical manner that support the principles of integrity and impartiality, at all stages of any procurement process undertaken.
In line with the UK’s public procurement policy, the FCO will generally always respond to its procurement requirements through competition (except for very low value contracts and in very limited special cases). This helps the FCO to identify and consider a variety of market proposals/options; drive performance improvement and innovation from the marketplace and helps to ensure that the best value for money solution available in the market is achieved.
The type of competition ranges from a straightforward comparison of simple quotations to a full formal sealed tender process and depends largely on the estimated lifetime value (whole life cost) of the purchase in question.
The relevant financial levels are as follows:
- estimated contract value up to £5,000 — Contracts will be made with reliable and good value suppliers determined with or without the need to obtain competitive quotations.
- estimated contract value between £5000 - £80,000 — Contracts will be made following a competition process using either written quotations that may be emailed or faxed, or following a formal competition process using sealed bid tendering.
- Contracts above £80,000 will normally be subject to the EU Procurement Regulations, where specific procedures apply, that will ensure the running of a fair and transparent competition to determine the successful supplier/service provider.
What categories of goods, services and works we buy
We buy a wide variety of goods, services and works.
- the design and construction of new embassies overseas
- worldwide travel, logistic/freight services
- facility management services, and mail and portering services
- information technology and communications equipment and services
- security guarding services in the UK and overseas
- a range of resourcing needs, such as temporary staff and specialist contractors and interims, as well as professional services and consultancy advice
- armoured vehicles
- other corporate services such as office products and stationery, training and development, marketing and PR.
If you have an interest in providing any of the above goods, services or works to FCO in the UK or to any of our overseas locations then please download/complete the Supplier Interest Form in the Contract Opportunities section.