Manchester snubs OGC in card row

28 April 2004
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29 April 2004 | Andrew Golder

Manchester City Council has snubbed the Office of Government Commerce (OGC) by rejecting its preferred purchasing card and signing up with a rival.

The OGC has demanded to know why the council chose the Royal Bank of Scotland MasterCard rather than renew its contract for a Visa card.

But SM has learnt that the council, one of the country's biggest users of purchasing cards, putting around £50 million a year through them, is yet to officially respond to the OGC's inquiry.

Last week, the OGC was playing down talk of a rift. A spokesman said the decision to question Manchester was "in no way sour grapes".

He said the OGC routinely contacted councils that decided not to use the products it had recommended to ensure best value for money.

"No one is arm-twisting local authorities and telling them how to spend their money."

A spokeswoman for the council said it chose MasterCard because it was cheaper. "Our existing contract for a purchasing card expired on 31 March and we went out to competitive tender. The RBS MasterCard was the most competitive bid and best met our needs," she said.

"There is no reason why we should use the government's favoured product and we were not aware they were displeased."

But while the OGC and Manchester City Council were publicly playing down talk of a rift, insiders were more candid, explaining how the authority's decision had perplexed officials.

A senior source at Manchester City Council told SM: "The OGC was told that frankly it was none of their business."

An OGC official said: "We still don't know why it has gone down this road. Manchester obviously feels it's the right way to go, but it has always done its own thing."

The OGC signed a new five-year agreement with Visa in 2003, extending the card from central government to NHS trusts, councils and other public-sector bodies.

The cards speed up the process of buying low-value, high-volume goods. The OGC says the benefits of the Visa purchasing card are that it offers good management information, carries no initial charge and is issued by more banks than the rival MasterCard.

At present in England around 100 public-sector bodies use the card. About 570 NHS bodies and a further 150 local authorities are eligible to use it.

The Society of Purchasing Officers in Local Government (Sopo) has supported Manchester's decision.

John Scowen, chairman of Sopo, said: "The OGC should be promoting purchasing cards, not arguing with local authorities because they have changed the product they use."



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