Megacities And Alpha Cities In The UK: How Will Procurement Have To Change? by Colin Cram

Posted on January 15, 2015 by

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‘Megacities’ and ‘Alpha cities’ are terms which illustrate the huge growth in cities across the world. London and the Home Counties’ commuter belt make up the UK’s only megacity, with a combined population of over 10million people. Greater Manchester, with a population of 2.7 million is by some definitions an alpha city. Mega cities and alpha cities cover largely built up areas that are economically interdependent.

The creation of the Greater Manchester Authority, with much increased devolved powers, points the way to a major reform of local government and the public sector. Within the next 5 years, we can expect similar powers to cities and surrounding areas of Leeds/Bradford, Sheffield, Newcastle, Middlesbrough, Birmingham, possibly Bristol and Glasgow – and even Merseyside. Looking further ahead into my crystal ball, we can expect in those ‘cities’, within the next 10 years, coherent management of public services, including those delivered by the NHS and local government, plus transport and the emergency services. The requirement that each city will have a mayor will be a catalyst for unifying service delivery.

The reforms will occur because of the efforts of Richard Leese, the Leader of Manchester City Council, and the Chief Executive, Sir Howard Bernstein, to win greater powers for Greater Manchester. As an interesting aside, each were recently voted in the Local Government Chronicle as the most influential people in local government. Notwithstanding the interest in expanded powers, these reforms are necessary given that UK’s cities are in competition with those of other countries, particularly in regions such as South East Asia, as well as some European cities.  The extreme example of this is the decision by an Indian state to build a new, state of the art city that is 10 times the size of Singapore. The world is changing fast, cities are developing fast and UK ‘cities’, including Greater London and the Home Counties, need to get their skates on.

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All this will have an impact on procurement.

As 50% of local governments’ and secondary care trusts’ costs are procurement, the ability of each city to deliver what its citizens need will depend on how well it manages its procurement.

Procurement professionals should expect to see a move towards integrating the public procurement organisations in those cities, including those of the emergency services. This will also result in an increasingly close working relationship with the Crown Commercial Service.

Commercial expertise and thinking will be needed and valued. It will become part of the DNA of the public sector and the UK’s cities.

Expertise in contracting and contracts management will be a must. UK cities will compete with each other as well as cities overseas. Making the most effective use of resources will be an absolute priority for any city with ambition. The counties will also need to work out how to respond to this challenge.

In this context, I will be serving as chair for the upcoming Procurex North and South http://www.procurexlive.co.uk/.

Designed to start preparing procurement professionals, commissioners and senior managers for this new world, I will be focusing on a number of key speakers including Sir Howard Bernstein, Bill Crothers (government Chief Commercial Officer), Sally Collier (Chief Executive of the Crown Commercial Service) and a wealth of top public and private sector professionals.

Procurex North and South http://www.procurexlive.co.uk/ are free of charge to public sector professionals. The plenary programmes are different. Each one is well worth attending in its own right.

Beyond Procurex, we have to continue to evolve and expand procurement’s capabilities to coincide with the emergence of these new city structures.

There is therefore potentially an exciting time ahead for procurement professionals, during which I fully expect our industry will have finally come of age.

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