NHS seeks IT suppliers in bid to save £300m a year

7 August 2002
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08 August 2002 | David Arminas

The NHS is seeking potential bidders for a major 10-year IT project expected to cut £300 million annually from the procurement budget.

Department of Health officials claim the Shared Services Project, to link electronically finance, procurement and human resources, will go a long way towards satisfying a recent Audit Commission report demanding improved NHS procurement.

Eric Jackson, e-procurement head at the NHS Purchasing and Supply Agency (Pasa), said the project will connect finance and procurement from requisition to payment.

"We are going to make every transaction with a supplier, from even before the requisition, from demand through to payment, electronic," he said.

Jackson was speaking at a gathering of 230 potential suppliers and consultants, the first since NHS Shared Services Initiative, the driver behind the project, notified potential suppliers in May that a call for tenders was being planned.

He urged suppliers to come forward as consortia by 23 August to discuss the project with the NHS before it advertises for a supplier in the Official Journal of the European Communities in early 2003.

Purchasing savings from the project are expected to be more than 5 per cent on the annual £6 billion procurement budget.

The electronic system will be mandatory for purchasers and the cost of a transaction is expected to fall from £25 to around £3, Jackson added.

He told SM: "A recent Audit Commission report was critical of procurement, said performance was patchy and trusts needed to all come up to a certain standard. This project is part of the answer to that."

Anthony Miller, research manager at research firm Ovum Holway, said companies looking for their first government business process outsourcing contract could be the winners.

"I would expect the contract to attract a large number of responses because no system is already in place," he said.

Concerns were raised in March when few bidders came forward for the renewal of a major IT contract, worth an estimated £4 billion, at the Inland Revenue.


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