27 November 2007 | Antony Barton
Local authorities must improve their staff procurement skills and consider various commissioning and purchasing options if they are to achieve the £4.9 billion efficiency savings set out in the Comprehensive Spending Review.
The Audit Commission's report Healthy Competition, released today, reveals most councils lack the necessary information, skills and mind-set to use the market to lower costs.
Michael O' Higgins, chairman of the commission, said councils should realise "competition" no longer necessarily means they should outsource services to the private sector.
He said in a statement: "Competition is now a two-way street where services may sometimes be improved by councils being able to offer a competitive threat to commercial providers. It is a powerful tool in focusing the minds of existing providers of services, whether they are public or private sector suppliers."
The report says councils must:
- take a pragmatic approach to using market mechanisms
- boost their commissioning and procurement skills
- make use of better information about service performance and cost
The analysis of councils across England was conducted by the Centre for Local and Regional Government Research at Cardiff University.