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28 April 2011 | Lindsay Clark
The Greater London Authority (GLA) has extended its deadline for achieving £450 million savings through shared services by a year after the London Assembly cast doubt over the figures.
The assembly’s Budget and Performance Committee had recommended in a report that by the end of April the GLA should submit more detail on its plans for shared services, which are set to include procurement functions and collaborative buying. The GLA said that several of these work streams were “still to be scoped”, and Nick Griffin, the mayor’s adviser on budget and performance, would present details in May.
Earlier this year, in a response to the GLA’s budget proposals for 2011/12, the committee had questioned the original shared services savings target. “The draft budget shows that in 2011/12 there will be savings of £1 million, leaving the GLA group £449 million of its £450 million savings target to find in 2012/13. We note that seven of the 15 work streams are still yet to be scoped. Significant savings will take time to materialise. As such, we question how realistic it is to expect that savings of £449 million will be found in 2012/13 given the lack of progress on many of the work streams to date,” the report said.
The GLA has now delayed the date by which it hopes to achieve the savings. It said the delivery of the cumulative target of £450 million over two years will require £150 million to be made in 2012-13 and a further £300 million savings to be achieved in 2013-14.
Back-office functions including procurement, payroll and HR, marketing and ICT are among those that could be shared by the GLA organisations and its own support functions, saving money on salaries. Collaborative procurement is also expected to contribute to savings on a spend of around £2.2 billion, according to the plans.