The public sector is a massive consumer of energy, water, and various other consumables, and therefore should be able to make a substantial contribution to reducing carbon emissions.
Public procurement regulations is absolutely front and centre to this, both in terms of buying more sustainable products and services, but also incentivising its supply chain to adopt environmentally friendly practices.
UK Targets For Net Zero
Year on year, we’ve seen a 27% increase in contract awards that mention keywords associated with sustainability. The total value of such contracts was more than 535 billion pounds in 2023 and is already at 400 billion for 2024 to date.
The opportunity for suppliers is to be active and willing participants in helping the public sector and contracting authorities to achieve its goals. It’s often suppliers who bring the innovations and fresh approaches, so it’s a fantastic opportunity to showcase what you can do.
The Role Of The Public Sector In Improving Sustainability
The public sector in the UK is huge. If you look at our spending alone, with that amount of money comes an awful lot of responsibility, and a lot of power to promote social enterprises in the world. The UK public sector has the commercial power to think about how we use that capital wisely and more sustainably.
“Particularly with infrastructure, the public sector has the ability to take a very long term ecosystem view of place and responsibility for place, and everything within that place that I think sets it apart on the sustainability agenda”.
Places like Amsterdam, Paris, Malmo and the rest of Sweden are all trying to embed the principles of circular economy and circular procurement. They’re going beyond just buying stuff and trying to make it less bad. They’re looking at how we buy things and make it good.
That really requires a strategic approach to what we buy and how we create this. Looking at things like reusing materials, thinking about the infrastructure of a particular city, looking at transport, green spaces, where our schools are located, how the flows work, where businesses are.
“It is the infrastructure piece that I think the public sector’s got a real role to play in determining how and where we live, and that fabric of our life. And that’s where we can really start to embed some transformative sustainability principles”.
The Role Of Suppliers In Supporting The Ambitions And Targets Of The Public Sector
Two thirds of our environmental impact sits in our supply chains.
“If we want to have this regenerative economy and circular economy where our consumption is reduced, we need to build those supply markets. And at the moment, some of those supply markets don’t exist”.
Public sector procurement and the UK public contracts regulations has got a really key role in shaping these markets. The amount of cost pressures on the public sector at the moment make it difficult to focus on these issues.
“From a climate perspective, we don’t have the luxury of time. We need radical action and we need that now”.
What can suppliers do?
- They need to engage in conversation regarding a new regime of transforming public procurement.
- Shifting urgently to reduce consumption – buyers and sellers have a role in that we need to stop making as much stuff as we do.
- Manufacturing is bad for emissions unless we can move on scale to more renewable energies to power that.
- So a good way they can start is what is their waste materials? What are we wasting? And how do we address that waste stream to reduce that waste because that will automatically reduce some emissions in terms of reducing consumption.
- Scale of economy – that model has to change because it’s incentivising us to use more because it becomes cheaper. And therein lies the problem.
- How do suppliers use their pricing structures to incentivise differently? So the emphasis becomes getting us to use less things, but we pay you better for using less.
- How do we encourage that innovation where actually if you buy less, we will make our products more durable.
- Being more honest in our impacts. At the moment we might log some of our emissions or carbon count, but we’re not really giving a full account of the harms that we create.
Once we start to put that front and centre in our account or disclosures, we’ll start to do something about it. That’s an uncomfortable space to take businesses to largely because the logics of business are all about profit growth.
Procurement practitioners in particular really needs to think strategically even before we’ve bought anything. The whole purpose needs to be embedded in and, not just think about from a new procurement act point of view, we tend to get involved in thinking about sustainability when we are buying something. But there’s a step before that, which is why are we buying?
The public sector needs to collectively come together and move away from the disjointed way of doing things, and begin seeking medium sized enterprises to assist in delivering more sustainable goods and services that can promote more dynamic markets.
This requires strategis planning of our commercial lifecycle. Not only this, but how do we achieve sustainble international obligations, while remaining compliant to our domestic needs. Through the process to embed transparency, and deliver more actionable procurement regulations that has passed through the cabinet office, only then can we begin to open our commercial system to more creative solutions to servce a new regime.
Diversity Of Suppliers
Thinking about new solutions that could maybe unlock some of the potential in the infrastructure that we have or the services we can offer. If you’re talking to a more diverse supply chain, the chances are you’re going to get more of that feedback coming in.
The Procurement Act will hopefully be a bit more open to some of these things in terms of more of a focus on market engagement. Making it easier to have that conversation very early in the procurement process to understand what’s out there and who can provide different solutions.
More focus around transparency will create more data that we can really start to get under the skin of procurement activity in a way that right now isn’t happening to that degree. But it’s important that suppliers can understand regulatory changes taking place in the procurement regime. The Procurement Act 2023 has seen the government transforming public procurement, and introducing secondary legislation that sets our key points for small businesses and embed transparency.
How Tracker Can Help Suppliers
Using services provided by Tracker Intelligence, suppliers can conduct contract searches more effectively, and begin the process of early engagement. By having conversations surrounding sustainability can provide suppliers with the innovative approaches needed to support and resolve current climate issues found within the public sector.
