Postal deal saves public sector £65.5m

9 March 2007
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09 March 2007 | Antony Barton

The public sector has saved £65.5 million in the past year through a postal deal with Royal Mail.

More than 2,200 public sector organisations have made savings through the arrangement, accounting for a total of £431 million in business for Royal Mail in the current financial year. The National Audit Office ratified the figures earlier this week.

Government buying agency (OGCbs) initiated the deal, made last April, with support from the OGC. It was the first collaborative contract created with OGC involvement to deliver savings under the government's procurement efficiency programme. It has since been followed by similar agreements for products such as departmental vehicles and IT hardware.

OGC began the project by conducting an assessment and feasibility study of the postal market. It then initiated the procurement process for a framework agreement in partnership with OGCbs, which manages the contract.

An OGC spokeswoman told the figures were early evidence that its category management strategy and engagement with suppliers on behalf of government were working.

HM Revenue and Customs, with assistance from OGC, is leading a collaborative procurement for courier services, to be awarded later this year. The OGC spokeswoman said other savings deals are due to be announced by the end of this month.


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