MINISTERS have been accused of breaking the law by sidestepping Scotland in awarding a key public money contract to help design the new National Care Service (NCS), the Herald can reveal.

The Scottish Government decided to outsource the work, and handed the contract to global consultancy firm PwC - but failed to use its own Scottish system for procurement which aims to make it easier for national businesses to supply goods and services to the public sector.

PwC was awarded the initial £100,000 deal for "mobilisation expertise" for the NCS including a “high-level roadmap towards delivery of design".

According to the Scottish Government's Public Contracts Scotland (PCS), on April 18, 2016 it became a "legal requirement" for "all" Scottish public sector bodies to go through them to advertise all goods and services being sought valued at over £50,000. This is confirmed through the terms of the Procurement (Scotland) Regulations 2016.

But the Herald has confirmed that the contract was only advertised and awarded through a "highly secretive" UK Crown Commercial Services framework agreement instead.

The respected think tank Common Weal which had an interest in supporting the care service design say they believed that meant the move was unlawful and that only 269 suppliers within the agreement were notified of the search. It said only a small number had any direct links to care delivery.

PwC were the only company to tender for the work.

HeraldScotland:

READ MORE: Firm gets £777,500 taxpayer funded contract to resolve Scots ferry fiasco

And Common Weal fears that further outsourcing work may be carried out outside the Scottish procurement system on the development of the care service.

"The way the Scottish Government have advertised both the contract awarded to PWC was unlawful, "said a Common Weal source. "At the very least it is extremely hypocritical."

The Scottish Government say the contract was awarded "entirely appropriately".

Establishing a National Care Service is a key Scottish Government policy for the coming Holyrood term and is due to be fully up and running by 2026.

There have been more than 11,500 Covid-related deaths in Scotland and around a third occurred in care homes.

Nicola Sturgeon has said the reform of adult social care would be a “fitting legacy from the trauma of Covid” and would be the “most significant public service reform” since the establishment of the NHS.

The Scottish Government has previously stated that the Procurement Reform (Scotland) Act 2014, had aligned with their purpose to create "a more successful country, with opportunities for all of Scotland to flourish, through increasing sustainable economic growth".

The 'sustainable procurement duty' clause in the Act, which aims to make the best use of public money states that the contracting authority must before beginning the process "consider how it will improve the contracting authority's area", which in this case would be Scotland.

It states that it should also facilitate the involvement of small and medium enterprises and promote innovation.

PCS was launched by the Scottish Government in August 2008 and in 2019/20 some 75% of suppliers winning contracts on it were Scottish. Some 63% were small to medium-sized businesses.

HeraldScotland:

The aim of the Scottish system was to provide valuable free contract information to suppliers and support the public sector to achieve a more transparent tendering process and to build stronger communication links with buyers and suppliers and stimulate growth in Scotland.

It was set up in response to the recommendations in the Review of Public Procurement in Scotland report, which said that in order to maintain a competitive environment and to support an open and transparent market environment, "a single public sector 'electronic portal' should be established".

PCS states that it meant suppliers can "access essential information on opportunities to offer services and bid for contracts for the supply of goods, works and services to the whole public in Scotland".

The £14.2 billion of Scottish public procurement spend in 2018/19 was estimated to generate around £11.2 billion of economic activity for Scotland, to contribute around £6.2 billion to Scottish GDP and to support around 111,000 full time equivalent jobs.

An estimated 26,094 suppliers in Scotland directly benefited from Scottish public procurement spend in 2018/19 through PCS, with many more businesses indirectly benefiting within supply chains.

"There are serious questions to be asked about why the Scottish Government does not have the capacity or expertise to have done the proposed work itself but, having decided to outsource the work, advertising the contract through a UK framework of commercial businesses, effectively precluded people with knowledge and expertise in Scotland from responding to the tender," said Common Weal.

Nick Kempe, a former head of service for older people and adults in Glasgow and convenor of Common Weal's Care Reform Group, said Audit Scotland should investigate the award.

And he also further questioned the legality of the announcement of the contract to PwC on PCS which appeared to come at least 33 days after the request expired. There is a legal requirement for contract award notices to be "sent for publication" done through a touch of a button no later than 30 calendar days after a contract award date.

"Only 269 suppliers on the framework could see the advert," he said. "You wouldn't have a clue the opportunity was there unless you were on that framework. It has been highly secretive.

"We are trying to contribute to the development of the NCS and know there are organisations in Scotland who, if given the chance, would have considered applying for the tender awarded to PwC."

HeraldScotland:

The PwC contract will see the company work on a plan to set up a “agile design team for National Care Service” and produce a “high-level road map for design milestones”.

The firm will also be asked to create a “stakeholder map and strategy”, which would outline “key contact and sponsorship teams required for design and business case development”.

The award to PwC has been criticised by the Scottish Trade Unions Council (STUC) which accused the company of having a “vested interest in privatised provision”.

STUC general secretary Roz Foyer said it was not clear why the expertise of the civil service was not being used.

A Scottish Government spokesman said: “PWC have a contract to support the setup of the programme management structure for the introduction of a National Care Service.

“The contract was awarded entirely appropriately and in accordance with the Crown Commercial Services Management Consultancy Framework which is available to all Scottish and UK public bodies and which offers an appropriate balance between cost and quality.”

Plans for a National Care Service were announced in August, and marks a significant shift from arrangements in England and not for the first time.

When the Sutherland Commission recommended free personal care across the UK in 1999, only Scotland implemented it.

One in 24 Scots relied on some form of social care support and services at the start of 2018.

Some 68,000 required care support at home, apart from informal, unpaid care, often by family members. Care homes housed 34,000 people.

An independent review undertaken by Derek Feeley recommended the NCS for Scotland to achieve consistency, drive national improvements, set standards, and bring national accountability and oversight.

SNP’s proposals went beyond the scope of his review to include community health, primary care and potentially children’s social care, criminal justice, and social work.