3. How is the Welsh Government ensuring best value for money for public procurement? OAQ53333

I thank the Member for the question. The Welsh Government's approach to best value from procurement includes maximising spend in the Welsh economy, securing wider community benefits from that spend, and ensuring that fair work and ethical standards of employment are maintained when money is spent on behalf of the Welsh public.

In November I hosted an Assembly event with 3SC, a social enterprise established to bid for public and other contracts, harnessing the power of the third sector to deliver those contracts via organisations that otherwise lose out. At the event they launched their position paper, 'The Crisis in Public Sector Contracting and How to Cure It: A Wales Perspective', highlighting some of the challenges the third sector face in relation to public sector procurement in Wales and some thoughts on how these could be addressed. They said that whilst the social enterprise sector is growing in Wales, the sector remains small and unfulfilled in reaching its full potential, and the presence of an internal monopoly in many local authorities is just as restrictive of innovation and diversity as if the service was being provided by a big private sector outsourcer. How, therefore, will you engage with this report to look at its proposals for greater sensitivity in how services are procured and an explicit commitment for third sector and smaller organisations to secure a reasonable share of the public procurement pie? Finally, where they say problems such as reoffending, housing, disability and employment need co-operation, patience and clear thinking as well as money, but money that is spent not just with an eye to getting the cheapest solution, but the best solution—in other words, partnerships with purpose—will you consider this report?

Llywydd, I'm not familiar with the report, but I'd certainly be keen to study it, and I'm grateful to the Member for drawing it to my attention. He's right, of course: we know that winning contracts for small organisations can be a struggle. It's why the Welsh Government has worked with the Centre for Local Economic Strategies to find ways in which small organisations, whether they be small and medium-sized enterprises or whether they be third sector organisations, can come together to collaborate on bids, to create consortiums, to form joint ventures, and in that way improve their chances of getting work through the public procurement process. The Member will be encouraged, I'm sure, to know that 58 per cent of businesses that came through the Sell2Wales website over the last 12 months have gone to Welsh SMEs, and that's a significantly higher percentage than, let us say, three years ago. But if there are interesting and new ideas in the report, then I'd be very keen to study it, and I'm grateful to him for drawing it to my attention.

First Minister, the question focused on value for money, but one of the other important areas is value for the Welsh economy. As you pointed out, it's also looking at how we can use public procurement to actually support the Welsh economy and small independent businesses. My colleague Mike Hedges has often raised this with you. An example could also be ensuring that Welsh steel is used in infrastructure projects for the public in Wales. Will you look at what is happening there and can you give us a progress statement on how the procurement process is changing to ensure that as many Welsh businesses and products in Wales are used in Welsh procurement?

I thank David Rees for that. As he will know, following the difficulties in the steel industry back in 2016, a particular procurement note was produced for Welsh public buyers to make sure that we maximised the amount of Welsh steel that goes into the buildings and other infrastructure investment that is made on behalf of the public here in Wales. A whole series of things have been done, as the Member knows, to make sure that we extract not simply best value for money but best value in that wider sense.

The community benefits scheme in Wales now covers more than 500 schemes, and that has been very successful in making sure that local jobs, apprenticeships, training and spend on that wider set of community benefits are derived from the way in which public money is spent. Our code of practice on ethical employment in the supply chain was marked by an event in January that Ken Skates attended to celebrate 150 organisations in Wales signing up to that code, which is a real, practical example of that wider sense of how what we mean by best value can be found in the Welsh economy.