Political Promise

Can Whitehall trim the fat?

In David Brownsey-Joyce on June 13, 2011 at 7:00 am

News that Francis Maude is creating a centralised procurement team for UK Government departments has David Brownsey-Joyce wondering whether this idea will actually save the predicted amount or whether civil servants will resist to keep their financial independence.

Just under nine months ago Sir Philip Green delivered his efficiency review into Government procurement processes, the findings making waves in that they said what a lot people already knew but dared not say; that each government department acts autonomously, purchasing contracts, goods and services at varying rates.

It took the Cabinet Office Minister or ‘Paymaster General’, Francis Maude, nine months but now he is coming to the rescue with a centralised procurement team to buy all the stationary, travel and office technology the civil service could ever need.

A central procurement team is a good idea to my ears, the notion that every department can go through the same supplier means you are in a position of strength to offer greater volume in exchange for lower costs, as their margins may be less but the volume will make sure they still come out on top. Plus there is the added reputation bonus of being a supplier to central Government.

The aim is to save £3 billion per year by 2015, I always think that trying to save things the same way can only gets you so far because put simply you run out of saving potential. Operating costs may go down in one area whilst in others they go up, especially as the cost of goods may rise due to inflation.

The plan could come tumbling down, if they do not rein in some of the 140,000 procurement cards available to staff in Government departments. This was a point made by the Green review but not mentioned by Francis Maude in recent reports. It found that over half of these cards, 71,000 were provided by four different suppliers; meaning four different contract types, payment clauses, interest rates. But more worrying that these 71,000 cards which had a monthly limit of £1,000 had little spending data available, meaning no records to audit.

If there is going to be a central procurement team to take care of office supplier, travel and various other purchases then surely a number of these cards can be taken out of circulation. The cards are designed for small purchases that procurement teams would not be appropriate for, citing transport and stationery; but wait these are things cited in recent reports by the Francis Maude as areas that central procurement team will be there to tackle. I’m confused and I worry that the civil service will be confused as well, and all of a sudden we will get to a situation where department heads will say, “we’ve got these cards just put the cost on those for now, we’ll let accounts know later.”

This is why I like auditing teams, I like information trails and so should every minister in Government (can you say expenses). So lets cut the cards with the exception of directors or above, and try to keep better records of who is spending what.

There needs to be a very clear policy in place saying that you need to use system A or else you will face action.

This won’t happen. The civil service are currently in a nightmare situation with pay freezes, recruitment freezes, job losses, changes to redundancy packages and staff terms, as well as bad press. Faced will all of this I can’t really see them wanting to bend over backwards for a minister who wants to change the entire way they work whilst at the same time axing 900 of the current procurement staff.

All this whilst also maintaining a claim to want to source goods and services locally, as a taxpayer I don’t want a civil servant to source goods and service locally just because they are local, I want them to source the best goods they can find that do the job for the most amount of time, at the most consistent level, for the lowest cost. If a local firm can do that, great, if not get someone else.

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