Tearlach MacDaid:
“Also the procurement process would have had to be designed to ensure that Northlink would not have had any advantage as they are owned by the SG, and profit retention by the public sector would again form no part of that decision process., and to be frank its more than naive to think that it would.”

So my, maybe naive, maybe daft-laddie questions is: Who makes the legislation? If the legislation allows for a companies such as Serco to bid and win, then I would contend that the criteria used is too narrow. Surely what we need is an ethical procurement process, one that includes criteria relating to ethics (which in this case directly contradict SNP’s policy for nuclear free Scotland) and other forms of capital.

The Scottish Government’s Purpose is set out as “To focus Government and public services on creating a more successful country, with opportunities for all of Scotland to flourish, through increasing sustainable economic growth.” Does the awarding of the contract to Serco serve this?

If the Scottish Governments hands are tied, then I’d like to know by who? This isn’t a “why-oh-why?” wail, more of a simple “why?”

Serco does not have experience in running ferries, but they do have lots of experience in running public services, as that’s all this is. They own no ferries, but will simply use the vessels and crew from Northlink, as they will be TUPed over. Remember that Northlink (which was a JV between Cal Mac and the BoS (I think) ) has only run this service for 15 or so years, taking over from P&O in exactly the same circumstances as Northlink loosing out to Serco. P&O had been on that route for 50 years or more. This is like a rail franchise changing hands, its like the Aberdeen bus company first taking over Scotrail. And why does Serco want to run the service – cos they think they can make money.

First knew nothing about running a railway, but knew about running a public transport system. Now they now know how to run a railway (or not depending on your point of view)

I was in Orkney the day before this was announced, and the expecttaion was that Northlink would walk back in. But the procurement process (of which I have many scars) can throw up some very strange results, over the which the procurer often has little control, short of the stopping the process and starting again.

Not very easy with a lifeline service.

Also the procurement process would have had to be designed to ensure that Northlink would not have had any advantage as they are owned by the SG, and profit retention by the public sector would again form no part of that decision process., and to be frank its more than naive to think that it would.

So unexpected but not unsurprising, although the legal challenge from Streamline certainly is. Either they are taking a flyer, or some one in Keith Browns Transport department has cocked up big time.

On a brighter note, delighted to see a little bit of shake up in Orkney Island Council today with the election of Steven Heddle as Convener, albeit by one vote. An Orcadian Astrophysicist, whose wife (who runs UHI’s Nordic studies school) as SNP candidate for Orkney has made serious inroads into the Lib Dem vote in those islands.

At the end of every contract every other bidder will go over the winning bid and the legislation with a fine tooth comb to see if they’ve got any cause to challenge the choice. I’ve no idea about the financial or economic advantage that the Serco bid offered but it must have satisfied the regulations which unfortunately is what counts in a public contract.

Appreciate the links and further facts on procurement.

I would of thought a potential £1m clawback from £1.4m yearly profit would be contribute to being “the most economically advantageous from the point of view of the contracting authority”. I would have also thought that that might allow room for interpretation in terms of retention of jobs (within the contracting authority’s area – i.e Scotland).

I do take on board :
So who made the rules? Do we need to look at adapting procurement practice so economic capital is not the only determinant factor when deciding? Should this be a part of any “new Scotland”?

Serco is well on the way to gaining dominance in the administration of public services. Surely that is not a sensible position to be either encouraged or tolerated.

It’s not a question of toleration it’s a question of having to follow the rules as laid out in the legislation.

The relevant part of the “The Public Contracts (Scotland) Regulations 2006″ for this discussion is:

Criteria for the award of a public contract

(b) offers the lowest price.

There’s a page on Outlaw.com which gives the basics about procurement.
http://www.out-law.com/page-5964

“Water Transport Services” fall under part B of the directive. There’s more on the Outlaw page about Part A and B.

This decision by the Scottish Government does need properly scrutinised, because in situations such as this, invariably what happens is the winning lowest price bidder who has no experience of how to provide the service, merely subcontracts to the previous service provider (who lost the bid, but needs the work), but at a lower price, with lower rates of pay (for the unemployed staff who previously run the service), and nice big juicy private profits at the taxpayers expense.

In effect the same company (in this case northlink) carries on providing the service, with half the staff, lower rates of pay, and an additional ‘middleman’ bid winner creams the profits.

I’d actually love to know what ferries Serco owns up in Aberdeen for running the route? Or indeed experience it has with the route??

I would have thought that John Swinney would have grasped the utter folly of such an approach.

Surely that is not a sensible position to be either encouraged or tolerated.