Government's net zero supplier quest 'in danger of being a British success story'

Over £87bn of government contracts have been let to suppliers with carbon reduction plans since PPN 06/21 rules kicked in, Adept chairman Ian Fishwick tells CRN

A government push to force public sector suppliers to decarbonise is "in danger of becoming a British success story".

That's according to the chairman of one IT and comms provider that sits on an SME panel that is advising the Cabinet Office on the strategy.

Talking to CRN, Adept chairman Ian Fishwick argued that new rules forcing public sector suppliers bidding for contracts worth over £5m to have a net zero plan are gaining traction more quickly than he and others anticipated.

The rules - known as PPN 06/21 - apply to most frameworks as well as contracts, and therefore will impact a large swathe of IT suppliers targeting public sector business.

Some 59 public sector procurements have applied the new rules since they kicked in on 1 September 2021, with just 32 (mainly smaller ones) exempt from them, Fishwick said.

During that time period, over £87bn of government contracts have been let to suppliers with carbon reduction plans, Fishwick continued, with only 17 of the 1,200 companies that have submitted a carbon reduction plan as part of tender responses rejected. And over 2,000 companies have been on the associated training courses run by Crown Commercial Service.

"I think it's a stunning initiative," Fishwick said.

"£87bn has been spent already on companies that have committed to a net zero path, so in terms of changing the mindset of the supply chain, it's been brilliant. This is in danger of being a great British success story."

Fishwick (pictured above) stressed the initiative is a world-first and that delegations from other countries including the USA and Canada have visited to find out how it was done.

"In the run up to Cop26 in Glasgow in November, it was perhaps inevitable that the UK was going to try and do something that was a world-first," he said.

"In the developed world, public sector spend ranges from between 35 and 53 per cent of the economy. Unless governments - particularly in the developed world - can learn to buy in a more carbon friendly way, it's mathematically impossible to get to net zero, because it's such a big part of the economy. No country had ever tried to figure out how you actually use the power of public sector spend to help. PPN 06/21 was the first time anyone tried to do it."

The SME panel Fishwick sits on has been tasked with examining the practical implications for the industry of PPN 06/21, with its focus now on creating case studies to help SMEs get to grips with measuring carbon emissions.

This includes how to get a handle on the more complex ‘scope 3' emissions, such as those generated by home workers or upstream and downstream emissions.

SMEs lacking the budget to take on an external consultant can do it themselves, according to Fishwick.

"Inevitably when there's any new initiative, a whole new industry of consultants appears. They'll knock on the door and charge anywhere between £500 and £3,000 to fill in the forms. Smaller suppliers can't afford that, and what we don't want is for the supply chain to shrink because small companies think it's too expensive to bid for government work - particularly on frameworks, when there's no guarantee of actually winning," he said.