Pickles spends £500K on travel
Discussion
Pan Pan Pan said:
P.s If `I' had been buying the above mentioned stand for a hospital, I would have told the supplier to poke it up his backside so far, only the castors would still be showing, and to go away and come up with a `correct' price.
Why don't those responsible for procurement of government funded items, and services do the same
Say, like the supermarkets seem to be able to do, and get away with?
Because it's not their money and I suspect a little back-hander every now and again clouds their vision!Why don't those responsible for procurement of government funded items, and services do the same
Say, like the supermarkets seem to be able to do, and get away with?
Pan Pan Pan said:
....I doubt I would be surprised if a bit of `commission/' wasn't part of those ridiculous, ridiculous sums.
Many years ago (late 80's) my Dad tried setting up a company selling specialist computer hardware such as waterproof keyboards that could be disinfected and hence used in hospitals and operating theatres.He eventually wound the company up because all his competitors were charging vastly more than he was but they provided back handers as part of the deal. An NHS procurement bod would rather buy a £1000 keyboard with a £100 back hander than a £200 keyboard with no back hander.
AyBee said:
Pan Pan Pan said:
P.s If `I' had been buying the above mentioned stand for a hospital, I would have told the supplier to poke it up his backside so far, only the castors would still be showing, and to go away and come up with a `correct' price.
Why don't those responsible for procurement of government funded items, and services do the same
Say, like the supermarkets seem to be able to do, and get away with?
Because it's not their money and I suspect a little back-hander every now and again clouds their vision!Why don't those responsible for procurement of government funded items, and services do the same
Say, like the supermarkets seem to be able to do, and get away with?
My firm brought in this policy for key employees, such that they could not even accept a cup of coffee from a supplier without declaring it ( Failure to declare could result in instant dismissal)
No one liked it at first, but it didn't half make things so much easier to deal with once its effects came into force, such that no one wanted to go back to the `old' system.
Pan Pan Pan said:
P.s If `I' had been buying the above mentioned stand for a hospital, I would have told the supplier to poke it up his backside so far, only the castors would still be showing, and to go away and come up with a `correct' price.
The thing that neither the nurse nor yourself have the relevant information about, is sight of the contract for the supply of that piece of equipment. It is not as simply as buying something out of a Maplins catalogue.The NHS has standard "supplier contracts" for all sorts of different things. These contracts run to hundreds of pages even for simple things. If you want to sell widget X to the NHS, you can't just name your (fair) price for "cost of unit + profit margin". You need to guarantee the performance of the product for all sorts of eventualities, and you have to assume (possibly very large) financial responsibility for the consequences of your device failing to operate in all sorts of circumstances. As an organisation you will need to hold and be anually audited on every single relevant ISO standard. You will have to have a clinical safety function to produce detailed reports that prove the safety elements of your widget. You will need professional liability insurance for extremely large sums of money (note that professional liability insurance is several orders of magnitude more expensive than public liability). You will need to guarantee that your device complies with all relevant NHS standards, and that it will continue to comply with all future standards that they may issue. In order to sell your widget to a hospital, you will need to make about 20 sales visits to present your widget to the hospital administrators, the safety team, lead consultants for all the major departments who will use your widget (and probably some who will not), the financial team, the staff management team, the H&S team etc. Many of those visits will be abortive because the person you made the appointment to see will not be available at the specified time. You may have to enter into a formal tender process, which can last months or years, cost many tens of thousands of pounds, and all this is done at your own risk i.e. if you don't win the contract you bear the full costs of the time and effort to participate in the tender.
Hopefully I've given you some insight that being a supplier to the NHS comes with some extremely large overheads just to be in the game. The ONLY way you generate revenue to cover these overheads is by charging an appropriate amount for each unit you sell. If you don't sell enough items for the right amount, you make a loss and eventually cease to be a business.
Pan Pan Pan said:
Why don't those responsible for procurement of government funded items, and services do the same
They do. In my direct experience, the NHS does a very good job of screwing suppliers down on prices. What you don't realise is that for the above mentioned reasons, the NHS directly forces up the prices for things it buys, because of the terms and conditions they impose on suppliers. The NHS does very little for itself; however it procures a VAST range of stuff. Most suppliers to the NHS are in a very competitive market. If a widget supplied to the NHS cost £X, then that is because (in all likelihood) that £X is the cheapest that anyone is prepared to supply it to the NHS and comply with all of the NHS terms, conditions and processes to buy said widget.PhilboSE said:
Pan Pan Pan said:
P.s If `I' had been buying the above mentioned stand for a hospital, I would have told the supplier to poke it up his backside so far, only the castors would still be showing, and to go away and come up with a `correct' price.
The thing that neither the nurse nor yourself have the relevant information about, is sight of the contract for the supply of that piece of equipment. It is not as simply as buying something out of a Maplins catalogue.The NHS has standard "supplier contracts" for all sorts of different things. These contracts run to hundreds of pages even for simple things. If you want to sell widget X to the NHS, you can't just name your (fair) price for "cost of unit + profit margin". You need to guarantee the performance of the product for all sorts of eventualities, and you have to assume (possibly very large) financial responsibility for the consequences of your device failing to operate in all sorts of circumstances. As an organisation you will need to hold and be anually audited on every single relevant ISO standard. You will have to have a clinical safety function to produce detailed reports that prove the safety elements of your widget. You will need professional liability insurance for extremely large sums of money (note that professional liability insurance is several orders of magnitude more expensive than public liability). You will need to guarantee that your device complies with all relevant NHS standards, and that it will continue to comply with all future standards that they may issue. In order to sell your widget to a hospital, you will need to make about 20 sales visits to present your widget to the hospital administrators, the safety team, lead consultants for all the major departments who will use your widget (and probably some who will not), the financial team, the staff management team, the H&S team etc. Many of those visits will be abortive because the person you made the appointment to see will not be available at the specified time. You may have to enter into a formal tender process, which can last months or years, cost many tens of thousands of pounds, and all this is done at your own risk i.e. if you don't win the contract you bear the full costs of the time and effort to participate in the tender.
Hopefully I've given you some insight that being a supplier to the NHS comes with some extremely large overheads just to be in the game. The ONLY way you generate revenue to cover these overheads is by charging an appropriate amount for each unit you sell. If you don't sell enough items for the right amount, you make a loss and eventually cease to be a business.
Pan Pan Pan said:
Why don't those responsible for procurement of government funded items, and services do the same
They do. In my direct experience, the NHS does a very good job of screwing suppliers down on prices. What you don't realise is that for the above mentioned reasons, the NHS directly forces up the prices for things it buys, because of the terms and conditions they impose on suppliers. The NHS does very little for itself; however it procures a VAST range of stuff. Most suppliers to the NHS are in a very competitive market. If a widget supplied to the NHS cost £X, then that is because (in all likelihood) that £X is the cheapest that anyone is prepared to supply it to the NHS and comply with all of the NHS terms, conditions and processes to buy said widget.There are a few, like the elderly, who get charged / conned five thousand pounds to replace a roof tile, but fortunately these are in the minority. but what you describe sounds exactly like these instances.
If it is done in the way you describe, then in my view the system is very, very wrong.
When governments issue a specification for anything from a plasma stand, to a fighter jet, that specification must be met in the item itself, adding costs because the item might not perform to specification is not in my view either legal or viable, and its practise should be stopped.
Any company not supplying goods which meet the requirements for a `reasonable' price should not be allowed to bid for government contacts (for a given period at least) otherwise it `looks' for all the world like (as some have pointed out here) that someone, somewhere is taking a substantial back hander.
We usually supply parts to the Automotive industry, however on occasion we have supplied parts to Govt depts. (not NHS) and it is simply outstanding.
The delays / bureaucracy / red tape, incompetence etc are amazing. When this resulted in the parts being potentially late the question was "how much do we have to pay to get them on time!"
Never once have we ever been asked to be "more competitive" as is standard in the private sector.
The delays / bureaucracy / red tape, incompetence etc are amazing. When this resulted in the parts being potentially late the question was "how much do we have to pay to get them on time!"
Never once have we ever been asked to be "more competitive" as is standard in the private sector.
PhilboSE said:
.... You will need to guarantee that your device complies with all relevant NHS standards,and that it will continue to comply with all future standards that they may issue. .....
I'd be interested to read that within a contract, please point me towards an example within a real contract. None of the NHS contracts I've been involved with over the years included such a clause. Pan Pan Pan said:
I think that most people when buying something, know when they are having their plonkers pulled on the price.
There are a few, like the elderly, who get charged / conned five thousand pounds to replace a roof tile, but fortunately these are in the minority. but what you describe sounds exactly like these instances.
If it is done in the way you describe, then in my view the system is very, very wrong.
When governments issue a specification for anything from a plasma stand, to a fighter jet, that specification must be met in the item itself, adding costs because the item might not perform to specification is not in my view either legal or viable, and its practise should be stopped.
Any company not supplying goods which meet the requirements for a `reasonable' price should not be allowed to bid for government contacts (for a given period at least) otherwise it `looks' for all the world like (as some have pointed out here) that someone, somewhere is taking a substantial back hander.
I don't deny what it can "look" like to the outside world, and I've got no doubt that there are very likely to be instances of inappropriate supplier/procurer relationships - after all we're dealing with human nature here and the NHS is the 4th largest employer in the WORLD so the possibilities for "bad apples" on both sides are endless. Skewed tenders and preferred suppliers do exist, of course.There are a few, like the elderly, who get charged / conned five thousand pounds to replace a roof tile, but fortunately these are in the minority. but what you describe sounds exactly like these instances.
If it is done in the way you describe, then in my view the system is very, very wrong.
When governments issue a specification for anything from a plasma stand, to a fighter jet, that specification must be met in the item itself, adding costs because the item might not perform to specification is not in my view either legal or viable, and its practise should be stopped.
Any company not supplying goods which meet the requirements for a `reasonable' price should not be allowed to bid for government contacts (for a given period at least) otherwise it `looks' for all the world like (as some have pointed out here) that someone, somewhere is taking a substantial back hander.
However, my experience of actually supplying to the NHS is that it's the organisation itself that causes the costs to go up. I'll give you a couple of examples. In one case, we were bidding to supply some software to the NHS. The tender contract we were given, when printed out on A4, stood over a foot tall. Amidst all of these documents, was the requirement that we had to guarantee our software would continue to operate in the event that there was a sonic boom caused by low flying aircraft. Bear in mind that we only supplied the software, not the hardware it was installed on, and we had no control over the operating environment. But there we were, having to guarantee our product against something that it was practically impossible to test against. I can only imagine that there had been an instance in the past where a piece of equipment failed, and the supplier absolved themselves of liability because they asserted that it was caused by sonic booms, and their device wasn't warranted against those. So I imagine that thereafter this clause got injected onto the standard supplier contracts to protect the NHS against this event happening again. But of course this causes a downflow of cost onto the supplier (to test against this requirement), or just to absorb the risk that their product would work in that eventuality without testing for it. However, when you have hundreds of similar clauses, you can see that the cumulative risks that the supplier is expected to absorb and warrant their product against becomes significant enough that they need to protect themselves against the possibility of a claim - which adds to the cost.
The other example is a national programme instigated by the NHS that came with very specific requirements. Suppliers could developer something to deliver against those requirements - except that when each NHS Trust came to tender for a solution to the national programme, they changed the requirements in significant ways. So then the suppliers could no longer have a single product certified for national use against some published requirements, they would have to create custom versions for every single Trust, making each unit significantly more expensive.
Of course we can look at this and agree it's not the correct/cheapest way to go about things, and we'd probably be correct. But the reality is that this is the situation that it is today, and it has evolved into the situation that we have where the NHS has teams of procurers whose only job is to protect the NHS from risk by flowing these responsibilities down to suppliers, and that has a direct impact on cost.
So we have a situation where from the outside the things supplied to the NHS "look" like they cost ridiculous amounts, and that the suppliers are taking advantage, but it's very much not as simple as that. Now, if the NHS, and patients, and patient advocacy groups were prepared to accept a small bit of additional risk then supplier costs could become much cheaper and the NHS could engender a truly open and competitive market. However, given we have a culture and climate that anything less than perfect care & outcomes results in public outcry and recrimination, it's not surprising that the NHS tries to minimise risk to itself and this results in a much bigger cost.
Edited by PhilboSE on Thursday 28th May 14:15
V8 Fettler said:
I'd be interested to read that within a contract, please point me towards an example within a real contract. None of the NHS contracts I've been involved with over the years included such a clause.
I obviously can't give you the complete document, but here is the clause:"The Suppliers service and systems MUST remain compliant throughout the term of the contract with the standards with that the suppliers systems adopt, including any changes to the systems or standards."
and
"The supplier MUST ensure that the service and systems will remain compliant with standards as defined by the ISB, deemed as required for the supplier’s solution by the Authority. The ISB standards can be found on the links below: http://www.isb.nhs.uk/use/baselineshttp://www.isb.nhs.uk/library/approvedhttp://standards.data.gov.uk/"
That's how it was written, and we queried it, and the answer was that we didn't have to guarantee the existing product against all future standards - just that we would commit to meet all future standards with our future versions of the same product. So - on interpretation a requirement that we could just about live with (albeit at some additional exposure to future risk/cost).
Edited by PhilboSE on Thursday 28th May 14:16
PhilboSE said:
V8 Fettler said:
I'd be interested to read that within a contract, please point me towards an example within a real contract. None of the NHS contracts I've been involved with over the years included such a clause.
I obviously can't give you the complete document, but here is the clause:"The Suppliers service and systems MUST remain compliant throughout the term of the contract with the standards with that the suppliers systems adopt, including any changes to the systems or standards."
and
"The supplier MUST ensure that the service and systems will remain compliant with standards as defined by the ISB, deemed as required for the supplier’s solution by the Authority. The ISB standards can be found on the links below: http://www.isb.nhs.uk/use/baselineshttp://www.isb.nhs.uk/library/approvedhttp://standards.data.gov.uk/"
That's how it was written, and we queried it, and the answer was that we didn't have to guarantee the existing product against all future standards - just that we would commit to meet all future standards with our future versions of the same product. So - on interpretation a requirement that we could just about live with (albeit at some additional exposure to future risk/cost).
Edited by PhilboSE on Thursday 28th May 14:16
V8 Fettler said:
But that's not what the contract states. Unless the tenderers are equipped with crystal balls they cannot reasonably comply with the terms of the contract, which was my point. The clarification contradicts the contract clause.
Your interpretation is incorrect, and the clarification does not contradict the clause. The clarification only confirms that the commitment to comply with future undefined requirements can be reactive rather than proactive.The requirement is that if you supply something to the NHS under these terms, then if the NHS changes their standards, then you MUST change your product to comply with their new standards - even if you sold it to them some years ago (and the contract term is still in effect). So although you don't need a crystal ball to build unspecified future requirements into a product on day 1, you still need a crystal ball to know what those requirements are, because you will be required to update your product to comply with them. Note that this update will need to be done by the supplier at their own cost - you don't get to charge the NHS again for a "new" product. You are making the commitment, at the outset of the contract period, to continually update the product to comply with future UNKNOWN requirements, during the contract term, without charging the NHS more money. So as a supplier you have to try to guess at what potential exposure to future costs you might be exposed, based on the changing whims of the customer. The only way you can do this is to either take a risk that the standards won't change in an impactful way, or build in an extra contingency cost to your product. Crystal balls still required.
Maybe now you get some insight into why supplies to the NHS (and government in general) are more expensive than they "should" be!
Pan Pan Pan said:
I think that most people when buying something, know when they are having their plonkers pulled on the price.
There are a few, like the elderly, who get charged / conned five thousand pounds to replace a roof tile, but fortunately these are in the minority. but what you describe sounds exactly like these instances.
If it is done in the way you describe, then in my view the system is very, very wrong.
When governments issue a specification for anything from a plasma stand, to a fighter jet, that specification must be met in the item itself, adding costs because the item might not perform to specification is not in my view either legal or viable, and its practise should be stopped.
Any company not supplying goods which meet the requirements for a `reasonable' price should not be allowed to bid for government contacts (for a given period at least) otherwise it `looks' for all the world like (as some have pointed out here) that someone, somewhere is taking a substantial back hander.
Try reading what I've written again.There are a few, like the elderly, who get charged / conned five thousand pounds to replace a roof tile, but fortunately these are in the minority. but what you describe sounds exactly like these instances.
If it is done in the way you describe, then in my view the system is very, very wrong.
When governments issue a specification for anything from a plasma stand, to a fighter jet, that specification must be met in the item itself, adding costs because the item might not perform to specification is not in my view either legal or viable, and its practise should be stopped.
Any company not supplying goods which meet the requirements for a `reasonable' price should not be allowed to bid for government contacts (for a given period at least) otherwise it `looks' for all the world like (as some have pointed out here) that someone, somewhere is taking a substantial back hander.
The costs are defined precisely based on the specification & requirements, and it is the complexity, risk and over-specification of those requirements by the customer (the NHS) that forces the costs up.
I don't know anything about these stands so what follows is not accurate but is representative of the type of requirements that go into NHS supplier contracts, and hopefully you'll get the idea.
The NHS wants to buy some stands. If the requirements go:
- Stands needed. Must support weight of 20kg and resist toppling from angles of 10 degrees or less.
Suppliers would be able to provide a stand to meet these requirements for a reasonable fee. However, the NHS requirements, based on years of iterative contract & tender experiences, and desires to reduce risk and exposure to being fscked over by suppliers, might look something like this:
- Stands needed. Must support weight of 20kg and resist toppling from angles of 10 degrees or less.
- Stands must be made from a material that resists bacterial growth for a period of 48 hours from exposure.
- Stands must meet all European standards for medical equipment
- Stands must meet all NHS standards for medical equipment
- Stands must have at least 6 castors on base for stability
- Stands must have ability to have castors changed without use of tools
- Stands must survive steam cleaning at 100 degrees for a period of 20 minutes for disinfecting
- Supplier must provide proof of ISB0129 clinical safety compliance
- Supplier must use hold ISO 27001:2013 for internal IT systems and ISO 9001 quality certificates and provide proof of annual auditing
- Supplier must guarantee stands for 5 years, replacements to be provided by supplier at no additional cost
- Supplier must commit to delivering any order by the NHS for any number of units with 7 days
Now how much do you think the supplier will want to charge? The same amount as before?
Pan Pan Pan said:
It consisted of stainless steel pole about 1.5m long, with 5 legs about 450mm long with a castor on each with a piece of stainless steel wire weld to the top to hold the plasma bags. Knowing it was for a hospital I guessed at about 175 to 250 pounds absolute tops. The nurse said no, it cost ONE THOUSAND SEVEN HUNDRED POUNDS, and this was for the `simple one' which did not have a cross bar at the top!
A nurse - who has absolutely nothing to do with the procurement process. And you believed her?That figure would have been Chinese whispered through about a thousand people through the NHS, each adding a bit to make it a little more dramatic with the retelling.
It's probably at £10,000 by now!
Ari said:
Pan Pan Pan said:
It consisted of stainless steel pole about 1.5m long, with 5 legs about 450mm long with a castor on each with a piece of stainless steel wire weld to the top to hold the plasma bags. Knowing it was for a hospital I guessed at about 175 to 250 pounds absolute tops. The nurse said no, it cost ONE THOUSAND SEVEN HUNDRED POUNDS, and this was for the `simple one' which did not have a cross bar at the top!
A nurse - who has absolutely nothing to do with the procurement process. And you believed her?That figure would have been Chinese whispered through about a thousand people through the NHS, each adding a bit to make it a little more dramatic with the retelling.
It's probably at £10,000 by now!
PhilboSE said:
Pan Pan Pan said:
I think that most people when buying something, know when they are having their plonkers pulled on the price.
There are a few, like the elderly, who get charged / conned five thousand pounds to replace a roof tile, but fortunately these are in the minority. but what you describe sounds exactly like these instances.
If it is done in the way you describe, then in my view the system is very, very wrong.
When governments issue a specification for anything from a plasma stand, to a fighter jet, that specification must be met in the item itself, adding costs because the item might not perform to specification is not in my view either legal or viable, and its practise should be stopped.
Any company not supplying goods which meet the requirements for a `reasonable' price should not be allowed to bid for government contacts (for a given period at least) otherwise it `looks' for all the world like (as some have pointed out here) that someone, somewhere is taking a substantial back hander.
Try reading what I've written again.There are a few, like the elderly, who get charged / conned five thousand pounds to replace a roof tile, but fortunately these are in the minority. but what you describe sounds exactly like these instances.
If it is done in the way you describe, then in my view the system is very, very wrong.
When governments issue a specification for anything from a plasma stand, to a fighter jet, that specification must be met in the item itself, adding costs because the item might not perform to specification is not in my view either legal or viable, and its practise should be stopped.
Any company not supplying goods which meet the requirements for a `reasonable' price should not be allowed to bid for government contacts (for a given period at least) otherwise it `looks' for all the world like (as some have pointed out here) that someone, somewhere is taking a substantial back hander.
The costs are defined precisely based on the specification & requirements, and it is the complexity, risk and over-specification of those requirements by the customer (the NHS) that forces the costs up.
I don't know anything about these stands so what follows is not accurate but is representative of the type of requirements that go into NHS supplier contracts, and hopefully you'll get the idea.
The NHS wants to buy some stands. If the requirements go:
- Stands needed. Must support weight of 20kg and resist toppling from angles of 10 degrees or less.
Suppliers would be able to provide a stand to meet these requirements for a reasonable fee. However, the NHS requirements, based on years of iterative contract & tender experiences, and desires to reduce risk and exposure to being fscked over by suppliers, might look something like this:
- Stands needed. Must support weight of 20kg and resist toppling from angles of 10 degrees or less.
- Stands must be made from a material that resists bacterial growth for a period of 48 hours from exposure.
- Stands must meet all European standards for medical equipment
- Stands must meet all NHS standards for medical equipment
- Stands must have at least 6 castors on base for stability
- Stands must have ability to have castors changed without use of tools
- Stands must survive steam cleaning at 100 degrees for a period of 20 minutes for disinfecting
- Supplier must provide proof of ISB0129 clinical safety compliance
- Supplier must use hold ISO 27001:2013 for internal IT systems and ISO 9001 quality certificates and provide proof of annual auditing
- Supplier must guarantee stands for 5 years, replacements to be provided by supplier at no additional cost
- Supplier must commit to delivering any order by the NHS for any number of units with 7 days
Now how much do you think the supplier will want to charge? The same amount as before?
Pan Pan Pan said:
Nope! you have just listed a set of specification items. If for any reason the item does not meet them, it should not be provided by the supplier, as in, it is not fit for purpose, and therefore not worth the money at any price, particularly not a ridiculously inflated one. It seems that once it is known that items will be paid for from the governments magic money tree, its price rockets no matter what it is.
I understand you'll completely disregard my comment, and that's fine, but your ignorance is staggering. I say that with some authority, having bought trains for London Underground and therefore procuring for the public sector.You don't have the grasp of this issue that you think you do.
WestyCarl said:
We usually supply parts to the Automotive industry, however on occasion we have supplied parts to Govt depts. (not NHS) and it is simply outstanding.
The delays / bureaucracy / red tape, incompetence etc are amazing. When this resulted in the parts being potentially late the question was "how much do we have to pay to get them on time!"
Never once have we ever been asked to be "more competitive" as is standard in the private sector.
The NHS asked me to continue supplying them without a purchase order as they were planning to go out to tender (two authorities were going to go joint) and we agreed. This was nearly 18 months ago. Each month I get an email from their processing centre in Wakefield saying they can't pay the invoices as I don't have a valid PO. I then forward this email to a contact I have there and they pay it immediately. I have no doubt I could double my prices and they wouldn't notice, but unfortunately I actually have morals so I can't do this.The delays / bureaucracy / red tape, incompetence etc are amazing. When this resulted in the parts being potentially late the question was "how much do we have to pay to get them on time!"
Never once have we ever been asked to be "more competitive" as is standard in the private sector.
Pan Pan Pan said:
We got to discussing the NHS generally, and in particular the financial problems it was / is facing. The nurse asked me how much I thought a wheeled stand next to my Mums bed used for supporting drips/plasma bottles cost. It consisted of stainless steel pole about 1.5m long, with 5 legs about 450mm long with a castor on each with a piece of stainless steel wire weld to the top to hold the plasma bags. Knowing it was for a hospital I guessed at about 175 to 250 pounds absolute tops. The nurse said no, it cost ONE THOUSAND SEVEN HUNDRED POUNDS, and this was for the `simple one' which did not have a cross bar at the top! If this goes on with all government procurement issues, the price for the above mentioned vehicles does not surprise me, The question is who is at fault? the government / hospital procurement departments for paying these ridiculous sums, or the suppliers for asking for it, My view would be a would be a bit of both, and I doubt I would be surprised if a bit of `commission/' wasn't part of those ridiculous, ridiculous sums.
One of these?
They cost less than your original estimate.
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