Cuts targets can be reached

22 October 2010

26 October 2010 | Lindsay Clark

The government’s proposed spending cuts are achievable, according to a narrow majority (55 per cent) of procurement professionals and experts surveyed in the SM100 poll.

In the Comprehensive Spending Review announced last week, Chancellor George Osborne said government departments, outside health and international aid, face average cuts of 19 per cent. Local authorities face a funding reduction of 28 per cent over four years.

Andy Foulis, head of procurement and FM services at Highlands and Islands Enterprise in Scotland, was among those who agreed the target could be reached.

“These targets should be achievable given that some areas of the private sector, particularly manufacturing, have been successfully returning 10 per cent savings year-on-year to survive against overseas competition,” he said. “The only down side to achieving these targets are the constraints applied through the EU procurement regulations which inhibit straightforward price negotiation.”

Another buyer in the private sector, who asked not to be named, said if there was the right commitment from all parts of the public sector the cuts could be reached. “It will come down to senior level support and the right staff.”

However, a private sector consultant said: “I do not believe this is an achievable target for buyers in the public sector due to constraints with EU procurement directives and lack of expertise and bandwidth.”

Twenty eight per cent of the SM100 shared his view, while 17 per cent did not know.

Liam Gormley, procurement category specialist at Newcastle City Council, said: “Lots of areas of government have been delivering significant savings for years. It is difficult to see where further opportunities can be found without going back to suppliers who’ve already been pressured into reducing prices and grinding them down further.”


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