HOW SHOULD LOCAL AUTHORITES’ PURCHASING

IN NORTH WEST ENGLAND BE ORGANISED?

Colin Cram
Regional Director
North West Centre of Excellence
AGENDA

PROCUREMENT IN THE NORTH WEST

THE NWCE APPROACH

STRATEGIC PROCUREMENT

HOW SHOULD WE ORGANISE NW

PROCUREMENT?
WHY IS PROCUREMENT IMPORTANT
NORTH WEST LOCAL GOVERNMENT:

£6.5BN PA

£900 PER ADULT AND CHILD

45% OF LOCAL AUTHORITIES’ COSTS

2 - 2½ TIMES COUNCIL TAX REVENUE

NEW CHALLENGES

COMPREHENSIVE SPENDING REVIEW

• 10% + IN 3 YEARS – CASH SAVINGS

GOVERNMENT POLICIES
• SUSTAINABILITY, LOCAL ECONOMY, SOCIAL
• SUPPORTING INNOVATION

TRANSORMING GOVERNMENT
• DELIVER IMPROVED/TRANSFORMED
• SERVICES/PERFORMANCE
THE NWCE APPROACH
RESEARCH

SHORT TO MEDIUM TERM GAINS (5%)

TRANSFORMING PROCUREMENT
- 12.5% PA BENEFITS WITHIN 5 YEARS
- PROCUREMENT STRUCTURE
- ADVANCED PROCUREMENT PRACTICES
- PROCUREMENT COMPETENCIES AND
EXPERTISE
- PROCUREMENT STRUCTURE
FACTS AND FIGURES ABOUT THE
NORTH WEST
• PURCHASE SPEND ANALYSIS

• PURCHASING PRICE ANALYSIS

• COST OF LETTING PURCHASING

AGREEMENTS

• BETTER CONTRACTS MANAGEMENT

ON WHAT IS THE MONEY
SPENT?
CONSTRUCTION 25%
HEALTH AND SOCIAL CARE 18%
COMMODITIES GOODS AND 18%
SERVICES WASTE
TRANSPORT 7%
TRANSPORT (EXCLUDING PTES) 5%
AGENCY STAFF, CONSULTANCY 5%
STATIONERY CONSUMABLES 0.1%
FACTS AND FIGURES
 15% OF SPEND WITHIN LOCAL AUTHORITIES’
BORDERS
 70% OF SPEND WITHIN NORTH WEST
 40% OF SPEND WITH SMEs
 60% OF SPEND WITH SUPPLIERS COMMON TO
MORE THAN ONE LOCAL AUTHORITY

 1% OF SUPPLIERS ACCOUNT FOR 60% OF SPEND

 0.1% OF SUPPLIERS ACCOUNT FOR 25% OF SPEND
‘‘MORE FIGURES’’
 PURCHASE TRANSACTIONS – 3.5
MILLION

 40% OF TRANSACTIONS BELOW £100

 15% OF CONSTRUCTION
TRANSACTIONS BELOW £11
STRATEGIC PROCUREMENT OBJECTIVES
• MAXIMISING PURCHASING LEVERAGE
• USE OF ADVANCED PROCUREMENT TECHNIQUES
• SUPPORT FOR PFIs, PROJECTS, OUTSOURCINGS
AND MAJOR CONTRACTS
• MARKET MANAGEMENT
• RELATIONSHIP MANAGEMENT AND EFFECTIVE
CONTACTS MANAGEMENT
• IDENTIFICATION AND EXECUTION OF
OPPORTUNITIES TO DELIVER IMPROVED VALUE
FOR MONEY
STRATEGIC PROCUREMENT OBJECTIVES
Continued

7. CONTRACTING FOR GOODS AND SERVICES

2. DELIVERY OF PURCHASING POLICIES E.G.
LOCAL ECONOMY
4. CONSISTENT AND COST EFFECTIVE
PURCHASING PROCEDURES AND PROCESSES
10. HIGH LEVEL OF SERVICE AND QUALITY
PRE-REQUISITES FOR STRATEGIC
PROCUREMENT

INFORMATION

LEVERAGE

EXPERTISE

SUSTAINABILITY – OF ORGANISATIONS

RIGHT STRUCTURES
HOW SHOULD PROCUREMENT BE
STRUCTURED?

1. EACH LOCAL AUTHORITY ACTS INDEPENDENTLY

2. COLLABORATION ON COMMODITIES GOODS AND
SERVICES
3. GEOGRAPHICAL PROCUREMENT HUBS
4. SPECIALIST PROCUREMENT HUBS
5. SUPER-HUB WITH GEOGRAPHICAL AND
SPECIALIST HUBS
 NORTH WEST PROCUREMENT STRUCTURES

STRUCTURE

OBJECTIVE 1 2 3 4 5
1.
2.
6.
7.
8.
9.
TOTAL
 NORTH WEST PROCUREMENT STRUCTURES

STRUCTURE

OBJECTIVE 1 2 3 4 5

1. 1 1 2 4 4
2. 1 1 3
6.
7.
8. 4 3 3 3
9.
TOTAL
WHAT SHOULD NORTH WEST
AUTHORITIES’ PROCUREMENT LOOK
LIKE?

STUDY TO REPORT BY END OF YEAR

VIEWS TO

Rahela.parvin@tameside.gov.uk