Public and Commercial Services Union

Securing an in-house bid

If after a review and use of a public sector comparator it is decided that the service will be put out to tender, PCS should press management to submit an in-house bid.

There are usually strong arguments for retaining the work in-house, which should be adapted to the specific circumstances of the function in question.

Your negotiations officer and regional organiser will be of assistance here.

In parallel to this, it is essential that PCS reps bring the relevant sections of the Agreement on Managing the People Consequences of Outsourcing and Privatisation to the attention of their departmental or NDPB human resources department, in particular :

(c) consider the option of continued in-house delivery

Departments affected by a possible transfer of functions may wish to prepare an in-house bid alongside invitations to tender being made to third parties.

The reasons for not allowing an in-house bid, where one has been requested, should be made clear to the relevant employees and the trades unions.

This guidance on managing the staff/people consequences of outsourcing and privatisation applied from April 1st 2008.

It is signed and endorsed by the Cabinet Office and the Council of Service Unions (CCSU), and is approved by the Permanent Secretaries Employee Relations Group and the Minister for the Civil Service.

It outlines “good practice” for Departments to follow, and makes clear these practices “should be followed”.

This means that Departmental HR must take the recommendations and best practice outlined in the guidance into account when considering or proceeding with an outsourcing proposal or planned privatisation.

Preparing an in-house bid

Should an in-house bid proceed it is crucial that it is prepared by the employers’ HR department, and not PCS itself. PCS should not prepare an in-house bid.

To do so involves the risk of fatally compromising the union, as the production of a credible bid – i.e. one that could beat other bidders - may mean endorsing job cuts and some worsening of members’ terms and conditions.

If, though, an in-house bid was prepared by management, PCS could and should participate – through full consultation at every stage - to do our best to ensure those members’ interests were protected, always ensuring we do not compromise our independence and national policies.

The first priority of the union is to retain in-house provision of services – both for the benefit of the service user and the staff. However, sometimes logical argument, campaigning and even industrial action are not enough to stop the contracting-out process.

If this is the case, it is vital that members are closely involved in the decision-making and in pre-decision meetings. Members must be informed and consulted.