Whitehall buyers prepare for huge cuts programme

10 November 2010
10 November 2010 | Angeline Albert 

The Cabinet Office has this week unveiled plans to slash administration costs, including procurement operations, by £100 million in 2013-14.

The figure accounts for half its current administration costs and is above the 33 per cent reduction target set by Chancellor George Osborne in his October spending review speech. The department intends to announce total savings realised from contract renegotiations in May 2011.

The move could affect buyers because procurement operating costs fall under ‘administration’ spending in Whitehall. Organisations with procurement roles and responsibilities that report into the Cabinet Office include the Office of Government Commerce, which has 253 staff, Buying Solutions which has 381, and the recently formed Efficiency Reform Group.

The Cabinet Office is one of a number of government departments publishing four-year businessplans, which include financial information, structural reform plans and departmental priorities. 

It also confirmed that a national procurement system to centralise buying of commonly used categories and commodities such as energy, office supplies, professional services, ICT and marketing will begin across government in March 2011. Whitehall departments will receive details about this from next month.

The Ministry of Defence(MoD) business plan aims “to reduce non-front line costs by £2 billion per year by 2014-15”. This will be done partly by making administrative cost savings. An MoD spokesman said: “We are going to lose 25,000 civilian staff across the MoD, to be decided over the next few months.”

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