Government saves £5.1bn with efficient procurement

24 November 2006
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24 November 2006 | Antony Barton

The government saved £5.1 billion over the last 18 months through more efficient procurement, according to the Treasury.

A spokesman told the savings, which will be detailed in the pre-budget report on 6 December, resulted from developments such as the Department of Health paying less for drugs and the Ministry of Defence using its purchasing power to buy defence equipment at lower cost. The reduction covers the period between April 2005 and the end of September 2006.

This information came yesterday after the chief secretary to the Treasury, Stephen Timms, told an audience of civil servants and other public service managers that government saved an overall figure of £13.3 billion in the same period, more than doubling the annual savings recorded in the 2006 Budget.

At the "Working Smarter" event, Timms said the savings were made with a gross reduction of 54, 963 civil service posts and the relocation of 10, 574 posts out of London and the South East.

The Treasury spokesman insisted the "vast majority" of these reductions were the result of employees "naturally moving on" rather than redundancies.

At the Efficiency Matters Conference this month, Sir Peter Gershon, author of the Efficiency Review, said procurement savings were vital if government was to meet the challenges of the 2007 Comprehensive Spending Review.


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