05 October 2006

Local authority procurement departments have failed to reach predicted efficiency savings.

According to figures released by the government last month, savings for 2005-06 were £6.4 million shy of expectations, despite overall efficiency gains in local government being greater than forecast.

Councils had estimated that they would make £113.1 million of procurement savings last year, of which £92.7 million would be cashable. But the actual figure saved was £106.7 million, with £87.3 million cashable.

A Department for Communities and Local Government (DCLG) spokesman told SM savings might have been claimed by other departments, and this would have reduced the amount that purchasing could declare.

In total, local authorities made £1.2 billion of savings, surpassing their estimate of £1.1 billion.

Procurement was still the third highest sector in terms of savings, behind adult social services, with £202.7 million, and corporate services, with £183.5 million.

SMoct2006