12 October 2010 | Lindsay Clark
The quality of government procurement data has been condemned by Arcadia Group owner Sir Philip Green in his report on public sector effiiciency, published yesterday.
“Procurement data is shocking – it’s both inconsistent and hard to get at,” said Sir Philip, who was brought in by the coalition government to analyse Whitehall spending. “There is inefficient buying by individual departments, with significant price variations across departments for common items.”
Lack of a mandate for centralised procurement together with inconsistent commercial skills across departments were among the reasons for inefficient performance across government, said Green's report.
Travel spend illustrates the point. “We were initially advised that the annual travel spend for central government was £2 billion; the second estimate was £500 million; the third estimate was £768 million. A thorough review revealed that the actual spend was £551 million,” the report said.
Sir Philip said there was no reason why government should not be as efficient as any good business. “Any large organisation would want to use its credit rating and scale to buy efficiently.”
Virtually no government departments have used these techniques to improve efficiency, he said.
Cabinet Office minister Francis Maude said: “The scale of the waste uncovered by Sir Philip and his team is staggering. His review shows that for too long there has been no coherent strategy to make government operate more efficiently.”
Other examples of procurement inefficiency in the report include multiple contracts with the same supplier. For example, the total annual spend on mobile phones in central government is £21 million, 98 per cent of which is with one supplier. This provider has 68 contracts with government departments and arm’s length bodies, typically negotiated by each department separately and not ending at the same date.