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Press release: ‘Limited Progress’ on ethical standards in outsourced public services: CSPL publishes latest report on ethical outsourcing

The latest in a line of reports by the Committee on Standards in Public Life says there has been little real progress on measures to reinforce ethical standards in outsourced public services and calls for a consultation on whether the Freedom of Information Act should apply to private sector providers where information relates to the performance of a public service contract.

Publishing its 2018 progress report today, Lord Bew, Chair of the Committee on Standards in Public Life, said:

From waste disposal to health care and probation services, all kinds of public services are routinely supplied to many of us by private or voluntary sector organisations, paid for with public funds – accounting for almost one third of government spending in 2017.

The public is clear that they expect common ethical standards – whoever is delivering the service – and that when things go wrong there is transparency and accountability about what has happened.

Our report in 2014 looked at departmental commissioning activity and the ethical standards of service providers and made a number of important and straightforward recommendations to enhance the government’s capability to commission services from providers who focus on high ethical standards in service delivery.

Today’s report shows that, disappointingly, very little progress has been made on implementing these recommendations and evidence shows that most service providers need to do more to demonstrate best practice in ethical standards.

In particular, we remain concerned over the lack of internal governance and leadership on ethical standards in those departments with significant public service contracts. Departmental and management boards spend little, if any, time considering ethical considerations and tend to delegate such issues ‘down the line’. Those involved in commissioning and auditing contracts remain too focused on the quantitative rather than the qualitative aspects of their role. And departments lack clear lines of accountability when contracts fail.

While many service providers have developed a greater awareness of their ethical obligations in recent years, partly due to the high-profile failure of some organisations to adhere to these standards, some remain dismissive of the Nolan Principles or adopt a ‘pick and mix’ approach, which is not in the public interest. And many service providers continue to expect that setting and enforcing ethical standards remain a matter for government alone.

The Committee remains of the view that more must be done to encourage strong and robust cultures of ethical behaviour in those delivering public services. To that end, the Committee reaffirms the recommendations made in its 2014 report and has made a further set of more detailed, follow-up recommendations to address particular issues of concern.

In particular, the Committee calls for service providers to recognise that the Nolan Principles apply to them, for greater moral courage among key financial and other professionals in securing and maintaining high ethical standards, and for consultation on the extension of the application of the Freedom of Information Act to private sector providers where information relates to the performance of a contract with government for the delivery of public services.

Following the corporate failures of a number of the biggest providers of services to government since 2013,
including the devastating collapse of Carillion early in 2018, it is now essential that the government confirm their expectations of ethical standards among those who deliver services with public money.”

The report can be downloaded online.

Notes to Editors: Interview requests and media enquiries should go to Maggie O’Boyle on 07880 740627. You can follow the Committee on twitter @PublicStandards.

  1. The independent Committee on Standards in Public Life advises the Prime Minister on ethical standards across the whole of public life in the UK. It monitors and reports on issues relating to the standards of conduct of all public office holders.
  2. To find out more about the Committee’s work go to the Committee on Standards in Public Life’s website
  3. The Committee on Standards in Public Life was established in October 1994 with the following terms of reference: “To examine current concerns about standards of conduct of all holders of public office, including arrangements relating to financial and commercial activities, and make recommendations as to any changes in present arrangements which might be required to ensure the highest standards of propriety in public life.” Additional terms of reference were announced on 12 November 1997: “To review issues in relation to the funding of political parties, and to make recommendations as to any changes in present arrangements.” On 5 February 2013 the terms of reference were clarified by the Government in two respects: ‘…in future the Committee should not inquire into matters relating to the devolved legislatures and governments except with the agreement of those bodies’ and ‘…the Committee’s remit to examine “standards of conduct of all holders of public office” [encompasses For] all those involved in the delivery of public services, not solely those appointed or elected to public office.’ Hansard (HC), 5 February 2013, Col 7WS .The Committee’s terms of reference were further clarified in a House of Lords written Parliamentary Question on 28th February 2013 to explain that the Committee’s remit means it “can examine issues relating to the ethical standards of the delivery of public services by private and voluntary sector organisations, paid for by public funds, even where those delivering the services have not been appointed or elected to public office.” Hansard (HL) Column WA347.
  4. The members of the Committee for this report are: Lord (Paul) Bew, Chairman, Rt Hon Dame Margaret Beckett DBE MP (Labour), Sheila Drew Smith OBE, Simon Hart MP (Conservative), Dr Jane Martin CBE, Dame Shirley Pearce OBE, Jane Ramsey, Monisha Shah, Rt Hon Lord (Andrew) Stunell OBE (Liberal Democrat) and Richard Thomas CBE. Richard Thomas CBE finished his 5-year term in office in May 2017. Sheila Drew Smith OBE, who led on this series of reports, finished her 5-year term of office in February 2018.

Link: Press release: ‘Limited Progress’ on ethical standards in outsourced public services: CSPL publishes latest report on ethical outsourcing
Source: Gov Press Releases

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Plastics

A Bill to require the Secretary of State to set, measure, enforce and report on targets for the reduction and recycling of plastic packaging; to require that such targets following the United Kingdom’s withdrawal from the European Union at least match such targets set by the European Union; to establish enforcement mechanisms in respect of such targets and associated provisions; to make provision for support for the development of sustainable alternatives to plastic packaging; and for connected purposes.

Link: Plastics
Source: Public Bills

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Press release: CMA considers regulation for heat networks

The Competition and Market Authority’s (CMA) study – which began in December – set out to establish whether heat network customers were getting a good deal in areas such as price, quality and service levels.

It has found that, for many, heat networks offer prices which are the same or lower than people on a gas or electricity tariff and have comparable levels of customer service.

But some customers – mainly those living in privately owned or rented properties – pay more for their heat through a heat network and, across the board, heat network customers aren’t getting the same levels of protection that gas and electricity customers receive.

The study found three main areas of concern:

  • Design and build – some property developers may try to cut the upfront costs of installing a network, resulting in higher ongoing operating costs, usually paid for by customers. Heat networks may also be installed where they are the best way to meet planning requirements, rather than the best solution for customers.

  • Monopoly of supply – because customers often have no alternative sources of heat and may be locked into long-term contracts, they cannot hold suppliers to account on price or quality.

  • Low transparency – before moving in to a property, people often don’t know that their energy will be supplied by a heat network and once people are living in the property, customer bills often fail to set out key information.

To address these issues – and given the expected expansion in the market – the CMA’s provisional view is that the sector should be regulated. This will mean:

  • consumer protections for all heat network customers, providing benefits such as complaints handling and access to an ombudsman and support for vulnerable customers

  • steps to improve the design and build of networks

  • all suppliers adhering to mandatory rules and criteria around price and quality in long-term contracts

  • measures to improve transparency including better information on networks, provision of heat supply agreements or contracts and clearer and more detailed bills

Rachel Merelie, Executive Director, Markets and Mergers, said:

“Heat networks can play an important role in cutting carbon emissions and keeping down energy bills, but some customers are not getting a good deal for this essential service.

“There is currently no regulator with responsibility for heat networks, so customers do not automatically benefit from the rights and protections that gas and electricity customers receive.

“Our current view is that regulation is now needed, to ensure that heat network customers receive equivalent levels of protection to gas and electricity customers.”

Some of our recommendations would require primary legislation. We are working closely with the UK government as well as the Scottish and Welsh governments to develop our recommendations.

The CMA is consulting on today’s recommendations until 31 May 2018 and will publish a final report in the summer.

Notes to editors:

  1. The CMA launched its market study into domestic heat networks on 7 December 2017.

  2. Heat networks distribute thermal energy to multiple properties for the use of heating, cooling or hot water. There are around 14,000 heat networks in the UK (of which 2,000 are district heating and the rest communal), together providing around 2% of UK buildings’ heat demand.

  3. The study looked at:

  • Whether customers are aware of the costs of heat networks both before and after moving into a property

  • Whether heat networks are natural monopolies and the impact of differing incentives for builders, operators and customers of heat networks

  • The prices, service quality and reliability of heat networks

  1. The study covers the whole of the UK and the CMA is working closely with governments and stakeholders in all four nations. Heat policy is devolved to the Scottish Government but not to the Welsh Government. Competition and consumer powers are reserved matters for the UK government and are not devolved.

  2. Market studies are carried out using powers under section 5 of the Enterprise Act 2002 (EA02) which allows the CMA to obtain information and conduct research. They allow a market-wide consideration of both competition and consumer issues. Market studies take an overview of regulatory and other economic drivers in the market and consumer and business behaviour.

  3. Further details of the CMA’s market study can be found on the case page.

  4. Media enquiries should be directed to press@cma.gsi.gov.uk or 020 3738 6460 / 07506710174.

Link: Press release: CMA considers regulation for heat networks
Source: Gov Press Releases