OGC warns against devolving procurement to the front line

Billions of pounds of efficiency savings could be put at risk if the government or the Conservatives press ahead with plans for a smaller central government and greater devolution to the front line, the chief executive of the Office of Government Commerce has warned.

Nigel Smith told the Financial Times: “Both the current government and the Conservatives are saying that they want a smaller, more strategic centre [with significant cuts in Whitehall numbers] and they want to have devolution of accountability and responsibility to the front line. “At one level, that is right. But the question I ask is, ‘what is in between?’ I don’t think there is an intellectual framework of what goes on between those two statements.”

The OGC chief executive warned that, with few exceptions, the government would not be able to mandate collaboration in purchasing and that a top-down approach would fail to deliver what was needed on the ground.

The FT interview coincided with publication of the OGC’s annual statement. This claimed £1.4bn savings across government through collaborative procurement in 2008/9, up more than 100% on the previous year. The office’s target for 2009/10 is to deliver £2.2bn savings.

The OGC also said it had achieved the Lyons target of relocating 20,000 civil service posts out of London and the South-East almost one year ahead of target, and completed the first full wave of procurement capability reviews. Other significant achievements, it claimed, were in the areas of sustainable procurement and projects (through the Major Projects Review Group).

“We are now setting the bar higher,” the statement said. “The current economic climate has placed ever increasing pressure on budgets and the demand for value for money has never been greater.  The Operational Efficiency Programme has set new and highly challenging targets for OGC in leading and supporting collaborative procurement, delivery of IT-enabled change projects, and efficiency and sustainability improvements in the Government estate.”