Forum Topic

Greene Report - be prepared to get angry/depressed!

While Lord Greene may for appropriate reasons be referred to by Private Eye as Lord Greed, his report on government purchasing policies challenges what financial savings could be made by centralising government expenditure (and in turn is a depressing read at the major waste that is currently occurring). While thirty odd pages, as it has been done in Powerpoint type format it is a pretty easy read. http://download.cabinetoffice.gov.uk/efficiency/sirphilipgreenreview.pdfThe savings identified from this very initial report, left me wondering if the separate proposals on say increased university grants and imminent major government cuts is tackling the right problem?

Joe Conneely ● 5815d10 Comments

Terrible sense of deja vu here. Greene seems to be advocating a return to the type of centralised purchasing the last Conservative Government spent a long time dismantling. This isn't a party political point - the last Labour Government followed the same sort of policy.The Thatcher/Major theory was that breaking up centralised purchasing would allow departements to compete against each other and secure the best deals. Hence - as Greene's report shows - we now have a range of prices negotiated by different departments for the same product/service.A`large part of Greene's estimate for the waste/potential savings in government spending is based on his assumption that new single contracts will achieve the lowest prices. Back in the 80s the then Government found evidence such centralised contracts were more expensive.It's a similar story with his criticism that the government is locked into inflexible, long-term outsourcing contracts for IT.So let's hope 'Comrade' Greene's enthusiasm for central control doesn't take us back to the old days of 'the man in Whitehall knows best'. The PM and Chancellor of the day would, by the way, have even more power if that did happen. Greater transparency about contracts will help, though will Microsoft and the other powerful multinationals want the rest of the world to know what it's charging the UK?

Guy Fiegehen ● 5815d

Guy,While hoping we would not return to a "Yes Minister" disaster and clearly Greene's report benefits in reading but suffers from guessing the detail by its brevity, I think it is pretty clear that the data and thus transparency does not easily exist so each government department has not got much of a clue as to what the optimal cost might be. The other key point is that the persons doing the spending do not think of it as their money for which they would be held accountable under current approaches but simply a budgetary spend they have to get rid of. The "free and open competitive market" that Thatcher and Major may have dreamed of simply does not exist!As always the right answer may probably be an amalgam of the two extremes! Having better procurement departments using recent open  market improvements and joined up national negotiations where major suppliers or strategies involved, cannot be any worse than the current mess seems the inevitable conclusion. In turn data would one hopes then be made more public without the need for endless requests under the Freedom of Information Act?

Joe Conneely ● 5815d

I agree Joe, the public deserves better government spending. And the Greene report can help push the issue up the poltical agenda.If I were Microsoft etc, I would offer a lower price to the UK Government for not revealing full details of the eventual contract so I could continue to play countries off. Not sure where tackling that leads us.

Guy Fiegehen ● 5815d

Guy, I believe that it is now illegal under EU law and that law in the UK is the Freedom of Information Act, to have confidentiality provisions being operated by suppliers on sales to government agencies except in limited circumstances (national security etc.). However automatically making the data public knowledge versus it having to be requested by a member of the public still seems a difficult and fraught area, as the recent criticisms of Ealing show.

Joe Conneely ● 5815d

I suspect the situation is:step 1: the goverment claims that the previous lot have been recklessly inefficient.step 2: an official report (in the current case by a monolithic top-down organisation) says how it should be done.step 3: the government makes "appropriate" changes "to improve efficiency".step 4: when the next government comes in, go to step 1.Is anyone else old enough to remember the Wilson mantra "fourteen years of Tory misrule"?

Ian M Green ● 5815d

No, but I do remember his referring to the '13 years of Tory misrule'

Guy Fiegehen ● 5815d

Ian,Stated as you do in your response, the 4 steps if no real change is made is I accept a recipe for disaster and no progress. However with the right attitude, your 4 steps is also the basis for continuous improvement? Be interesting to see how hard the coalition actually pushes the opportunity.

Joe Conneely ● 5814d

Only six months ago the Government was proclaiming the virtues of central government bulk buying from large companies following Philip Green's report. Today the Prime Minister says the public sector should buy more from small and medium-sized companies. Anyone else mystified about this?

Guy Fiegehen ● 5675d

I welcomed the fact that the Govt got PG in to look at reducing waste and improving buying effiencies.Albeit that I am not his greatest fan. Goodness knows how many times Govt's of all persuasions have claimed they are going to improve on wasteage, but all have failed.Having been a 'buyer' in both the private and public sectors - albeit that the budgets I was personally responsible for never exceeded £30 million pa - I do have some experience.It is far too simple to set a policy of buying from 'big' or 'small' suppliers. It depends on what you are buying, for what and over how long a time frame for delivery.Culture is also vital and training and experience. plus having the knowledge and skills to buy appropriately. For example, when I asked the last Chief Executive if the Council had set-up a framework of 'call-off'contracts to comply with European Law for public contracts valued at over 130,000 Euros and still ensure they could react to sudden unexpected needs? It appeared he hadn't got a clue what I was talking about.To get the best price, buyers also need to know how to behave, late payment might look clever, but suppliers soon learn who cost them money, not only in bank charges, but also in admin costs chasing payment. Very quickly these costs start to get built in to the price.The public sector has a rotten record here.Volume is not the be all, willingness to be adaptive adjusting to supplier demand flows can bring significant savings. I could go on, but one thing that does need to run through everything is to behave as if it is your personal money that is being spent.Also, get out and find out what is happening, never buy from a company before visting their offices/factory.

Charles Gallichan ● 5674d

How right you are Charles.Introducing central data so that all government departments can get a better benchmark would be a very useful step forward.Although it is hard work, regular chopping and changing contracts and suppliers keeps pencils sharpened.I think late payment schedules should be in the public domain as a code of practice.

George Knox ● 5673d