25 August 2010 | Angeline Albert

A procurement organisation in Scotland has saved the country’s public sector £60 million since spring 2008 and expects to exceed its 2011 goal.

Procurement Scotland, which was established in March 2008 and is part of the Scottish government, had a three-year target to save taxpayers £84 million by March 2011 but now expects to save as much as £90 million.         

Huge savings have come from a national electricity contract. The purchasing authority has saved £10 million a year by signing up a large number of organisations to the joint energy deal. This includes 32 local authorities, 22 NHS health boards, 62 higher and FE institutions and 75 central government bodies, as well as fire and police services.

The £200 million-a-year national electricity contract is with two providers, Scottish Power and Scottish and Southern Energy.

In addition, an £80 million-a-year national gas contract was awarded in December 2009 and is expected to save £5 million annually.

Up to the end of March 2010 Procurement Scotland had saved the government more than £20 million on IT hardware agreements and £6 million on an office equipment framework covering photocopiers and printers.  

Ian Howie, head of Procurement Scotland, said: “We are hoping to replicate the significant savings made in electricity with the gas contract. We don’t currently have national contracts in place for water and fuel, but we are looking at it.”

“Procurement, in general, can play a key role in the efficiencies the public sector can make going forward,” said Howie. “With the UK-wide tightening of belts and the need to make more efficiencies, a national approach can and does work.”