Public sector spending cuts 'could be hampered by bureaucracy'

24 June 2010

25 June 2010 | Andy Allen

Hopes that procurement can secure dramatic cuts in UK public spending may be excessively optimistic.

That is the conclusion of a study by Durham University and Wax Digital, which showed that public sector buyers were willing to lead the charge against excess spending, but bureaucracy, poor spend management and lack of automation could stand in their way.

The research found that 75 per cent of procurement heads and their teams were optimistic that they could reduce deficits by 2015, but they were unsure exactly how they would achieve the spending reductions.

Almost all of the 115 organisations canvassed had engaged in collaborative purchasing. However, 71 per cent saw only “moderate” success at best from such activities.

Only 6 per cent thought their spend management processes were “highly efficient”. For 68 per cent they were “moderately efficient” or “inefficient”.

Bureaucratic controls, lack of spend management processes and limited automation were cited as factors that would stand in the way of spending cuts.

Laura Watson, deputy director of procurement at Durham University, said: “Purchasing professionals are ready to lead the fight and drive increased value from the purchasing of resources required to run their organisations effectively.

“Maintaining front line services at a premium despite back office spending cuts requires creative thinking and new approaches. Procurement has changed massively in the past decade but it needs to continue the fight and go further.”

The report added that new IT systems have proved productive for procurement teams, but that automation of manual processes is still restricted in many areas which will hold procurement teams back.

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