2 March 2011 | Paul Snell
Joint
purchasing of nine different commodities will be in place by October 2011, according
to the Cabinet Office.
The
announcement was made amid a raft of new spending restrictions on central
government purchasing, which the government believes will contribute to more than £3 billion in efficiency savings expected
by the end of this financial year.
These controls will remain in place until 2015.
As SM has previously reported
the nine areas of spend that will be bought centrally on behalf of all
government departments will be energy, office supplies, professional services,
travel, fleet, telecoms, IT commodities, print and advertising and media. The goal
of centralised buying is to secure better deals from suppliers through larger
spending power, and presenting a united front to vendors in negotiations.
Under
the new controls that take effect from today, IT contracts worth more than £5
million, leases worth more than £100,000 and the purchase of any new property
will now have to be approved centrally.
In
addition, the Cabinet Office will establish a “major projects authority” which
will examine how major government projects are paid for and conducted. A
spokeswoman said the group would work with departments, the Treasury and
Infrastructure UK - the Treasury unit that supports large public sector capital
projects - to improve their success, increase accountability and report on
their progress to ministers.
It
was also announced freezes on recruitment and consultancy would continue and
only “essential” spending on advertising would be allowed.
“As
well as immediate savings, some of the new measures introduced today will
enable us in the future to get rid of previous inefficiencies in the way we
have bought goods and services and reinforce that as one of the country’s
biggest customers, government expects to receive a scale discount,” said
Cabinet Office minister Francis Maude.
Danny
Alexander, chief secretary to the treasury, said the controls were part of
creating a “seismic shift in Whitehall’s spending culture”.
The
government claims to have already saved £800 million through supplier
renegotiation, spent 50 per cent less on consultancy compared to the previous
year and £48 million by not buying new property.
