A new project could make Wales the first part of the United Kingdom where the public sector will buy all its goods and services on line. A ground-breaking scheme that it is estimated could bring savings of up to 200 million pounds over the next five years has been approved by the Welsh Assembly Minister for Finance and Public Service Delivery, Andrew Davies.

The project – xchangewales – will see the creation of a system that will enable every Welsh public sector organisation to find suppliers and order and pay for goods electronically. It is expected that it will bring benefits through lower prices, increased use of corporate contracts and paperless ordering resulting in reduced administration. In addition to the advantages for the public sector it is hoped the project will see improved support for small to medium businesses.

Andrew Davies said the programme showed Wales at its finest. “By modernising the procurement and payment process of the Welsh public sector, from schools to local authorities, Wales will be the first place in the UK to deliver an electronic sourcing, ordering and payments system on a country wide ‘shared services’ basis,” he said.

Currently the public sector in Wales spends more than 4.5 billion pounds on goods, services and capital projects. The most recent figures also show that the value of public sector contracts placed with Welsh-based companies has risen from 35 per cent to 49 per cent in two years. This is expected to rise further with the creation of a single Internet transaction hub designed to remove the barriers to public sector procurement faced by small businesses in particular.

There has already been widespread support for the scheme from the public sector and 17 organisations in health, local government and higher education have already volunteered to be pathfinders for the programme. Other bodies are in discussion about joining and it is expected that the project will go “live” in the spring.