Collaborative Procurement, part of the Treasury’s Operational Efficiency Programme is expected to deliver savings of £7.7 billion by 2013-14. Publicnet provides an overview of the Programme. This figure is credible using arithmetic as the basis for calculation, but there is concern that reality has not been properly factored into the equation.
Collaborative procurement is the method chosen by the Treasury to develop the public sector as an extremely powerful purchaser of goods and services. The aim is to exert leverage from the £175 billion spent annually to get better deals. The theory is sound and the numbers look realistic, in terms of arithmetic, but alarm bells start ringing when the situation on the ground is examined more closely.
The risk of not delivering the collaborative procurement initiative was recognized in the Treasury report with the comment that ‘the savings will only be achieved provided the key issues are addressed swiftly’. Orchestrating the development is an enormous challenge, but given that they key issues are addressed swiftly, progress is dependent on the instrumentalists, the buyers in 44,000 public sector organizations, who are expected to follow the conductor’s baton.
The fragmented nature of the public sector with so many organizations, diverse in size and function, presents an enormous communication problem. Having set up communications, the buyers have to be guided along the collective procurement path. Leading the 44,000 will be a mammoth task.
The Treasury report also makes it clear that an effective collaborative procurement arrangement will require harmonization and revision of management information systems. But every public sector organization is also grappling with other recommendations in the Treasury’s Operational Efficiency Programme which all require specialist computer support. The effect will be that the IT department will be under pressure from managers implementing recommendations relating to Back Office systems Asset management and sales and Property management . Even the Total Place Initiative will require mapping software The competition for specialist resources will be fierce and local priorities will determine positions in the queue. What is certain is that all demands cannot be met in a short timescale.
Another obstacle to speedy implementation of collaborative procurement recommendations is that the process of collaboration takes time, before the buying gets under weigh. The initial ‘getting together’ process is a crucial stage of the whole operation of collaborative procurement. The case of the London councils, Lewisham, Islington and Kingston upon Thames who are working together to buy the necessary IT support to ensure to meet the requirements of the government’s next major social care initiative – the Personalisation Agenda, illustrates the point. They have purchased Liquidlogic’s PROTOCOL Integrated Adult’s System (IAS), which provides a cohesive, multi-agency care planning system to enable social care practitioners to work with their clients and other agencies on integrated self directed care plans. But it took time to agree on the actual specification.
Calculating the likely timetable for implementing collaborative procurement from an office in Whitehall produces a very different result to making the calculation from any one of the 44,000 offices of public bodies around the UK. Buyers in these offices have to face the reality of the resources available to them. There is little doubt that the predicted savings can be made, but when it will happen is another question.