Procurement - use of consultants: guidance

Consultancy procedures

These procedures were written in discussion with organisations from across the Scottish public sector and are intended to help ensure accurate and consistent recording of expenditure, as well as providing best practice. Under the Public Services Reform (Scotland) Act 2010, one of the duties is to publish details of annual expenditure on external consultancy, adhering to these procedures will enable the SG to meet this legal requirement.

The three part test determines whether a service is defined as consultancy. The three tests are:

• there must be an on-going exchange of intellectual or professional information concerning the planning and/or delivery of the project or objectives between the SG and the supplier
• the commission/contract ends at the completion of an agreed output(s) rather than the end of a set period of time (subject to the required project timescales)
• the day-to-day task management remains with the supplier. However, a regular reporting arrangement should be agreed with the SG contact to ensure that progress is recorded, that issues/risks are identified early, and that resolutions are agreed and delivered, where necessary.

Critically, the procedures apply to the service being bought, not the supplier or person providing them and does not apply to legal services. If any doubt exists on whether the procedures apply or not enquiries should be addressed to scottishprocurement@gov.scot.

Approval controls to buy consultancy services

The approval controls to buy consultancy services for the SG are detailed in Table 1, Executive Agencies in Table 2, and Non Ministerial Departments in Table 3. All procurements must be conducted by staff with Delegated Purchasing Authority (DPA). The individual with DPA will determine the route to market e.g. if there is an existing framework agreement that can be used.

Table 1: SG consultancy approval controls

Table 2: Executive agencies consultancy approval controls

Table 3: Non Ministerial departments consultancy approval controls

Business areas must consider the maximum value of expenditure over the entire period of the consultancy requirement/contract that will be paid to a supplier to ensure the appropriate level of approval is sought.

If there is a variation to the contract which will result in costs exceeding the level initially approved, further approvals must be sought at the appropriate level before agreeing the additional work can go ahead.

Ministerial submissions to the Cabinet Secretary must contain the following information on the front page:

• the start and end date of the contract
• the total anticipated value of the contract (excluding VAT) from conception to completion i.e. over the entire contract duration
• the preferred procurement route, for example using a national framework agreement or competitive tendering

A checklist for business cases to accompany Ministerial submissions is available at Annex B.

For SG procurements, it is necessary to make the Consultancy Monitoring Group aware of any consultancy spend valued at £50,000 or over by copying the Commercial Value for Money (CVFM) mailbox (cvfm@gov.scot) when submitting consultancy approval request to the appropriate approval levels.

The Consultancy Monitoring Group will provide oversight and assurance to the Minister that consultancy spend is being regularly monitored and reviewed from a central perspective. The group will be responsible for monitoring the consultancy guidance, developing and maintaining a database of consultancy spend, identifying consistent needs, gaps in existing controls and add an additional layer of scrutiny and control to consultancy spend.