Deeper cuts forecast for public sector purchasing

22 November 2010
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23 November 2010 | Angeline Albert

Some government departments’ administration costs, which include procurement operations, will be slashed by more than was announced by Chancellor George Osborne in his spending review, according to their business plans.

For example, the Cabinet Office will cut £100 million by 2013-14. The figure accounts for half its current administration costs, which is above the 33 per cent reduction target set by Osborne.

Organisations with procurement roles that report into the Cabinet Office include the Office of Government Commerce which has 253 staff, Buying Solutions (with 381 staff) and the Efficiency and Reform Group.

The Treasury and the Department for Culture, Media and Sport will also halve administration costs to £100 million in 2013-14. Meanwhile, Communities and Local Government (CLG) is set to reduce costs by £200 million by 2013-14, down from £500 million in the current year.

Procurement operating costs fall under ‘administration’ spending in Whitehall.

“There will be significant headcount reductions and procurement will take a large share of that burden,” one former senior government procurement manager said.

Meanwhile, the Ministry of Defence said it would lose 25,000 civilian staff but is yet to decide how many buyers this includes.

A former head of national contracts at Defra, Gordon Samet, now head of public sector consultancy Gretzky, said private consultancies, which once provided opportunities for those leaving the public sector, were no long hiring in the same numbers. “With public sector jobs in procurement going, there is nowhere for buyers to go.”


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