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25/09/2012
Millions Wasted Through Public Procurement
A failure by public bodies to collaborate when buying goods and services is squandering millions of pounds in potential savings each year, auditors have found.
Around £2.7 bn is spent on procurement in the public sector in Northern Ireland every year, which includes around £880m for "common goods and services" (costs for energy, fleet and transport, office solutions, computer technology etc.)
Following an examination, the NI Audit Office found a lot could be done to improve this area.
Comptroller and Auditor General Kieran Donnelly published the findings and issued a report to the Assembly, remarking: "There is scope to increase aggregated demand and collaboration for common goods and services. If used properly, this can lever significant savings for the public sector."
Bodies which were examined included NI Water, the Roads Service, Translink, the health estates, education boards and the Housing Executive.
The report found a lack of basic management information in those bodies responsible for procurement and that only 4.3% of common goods and services were bought through collaborative arrangements last year.
It also found that procurement organisations had a lack of experienced, professionally qualified staff and that there was no benchmarking of prices, leading to certain bodies paying different prices for the same goods.
Many services are procured from small and medium-sized businesses (SMEs) in Northern Ireland, and so auditors assessed whether greater efficiencies might have an adverse impact.
They claimed there was no evidence to suggest greater collaboration would disadvantage local businesses, but said it was important to strike a balance between achieving savings and supporting SMEs through procurement.
(IT)
Around £2.7 bn is spent on procurement in the public sector in Northern Ireland every year, which includes around £880m for "common goods and services" (costs for energy, fleet and transport, office solutions, computer technology etc.)
Following an examination, the NI Audit Office found a lot could be done to improve this area.
Comptroller and Auditor General Kieran Donnelly published the findings and issued a report to the Assembly, remarking: "There is scope to increase aggregated demand and collaboration for common goods and services. If used properly, this can lever significant savings for the public sector."
Bodies which were examined included NI Water, the Roads Service, Translink, the health estates, education boards and the Housing Executive.
The report found a lack of basic management information in those bodies responsible for procurement and that only 4.3% of common goods and services were bought through collaborative arrangements last year.
It also found that procurement organisations had a lack of experienced, professionally qualified staff and that there was no benchmarking of prices, leading to certain bodies paying different prices for the same goods.
Many services are procured from small and medium-sized businesses (SMEs) in Northern Ireland, and so auditors assessed whether greater efficiencies might have an adverse impact.
They claimed there was no evidence to suggest greater collaboration would disadvantage local businesses, but said it was important to strike a balance between achieving savings and supporting SMEs through procurement.
(IT)
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