News

OGC announces results of Whitehall procurement capability review and improvement programme

Released on 01/10/2009

Nigel Smith, the Chief Executive of the OGC (Office of Government Commerce), has praised Whitehall Departments for their progress in driving forward improvements in procurement capability. These improvements are detailed in an overview report published today by the OGC summarising the findings of the first wave of the Procurement Capability Review (PCR) programme.

PCR results demonstrate how Whitehall Departments have developed a range of robust improvements in line with best practice.

Speaking about the reviews, Nigel Smith said:

"OGC's Procurement Capability Review programme has already delivered enormous benefits through promoting and embedding innovative and best practice procurement across Whitehall.  A lot of great work and professionalism has been identified in our reviews. If Government is to ensure that it meets its efficiency targets then it is vital that momentum is maintained, especially through developing the procurement skills base that currently exists. We look forward to supporting departments further along their individual paths of continuous improvement."

PCRs play a significant role in supporting the government's Operational Efficiency Programme (OEP), which aims to achieve efficiency savings from collaborative procurement of £5.7 billion by 2011-12 and £7.7billion by 2013-14.

Since the PCR process was announced in 2007, several changes have been made to drive up procurement capability across Whitehall including:

• Procurement and commercial issues being considered more regularly at departmental management boards;
• New senior departmental commercial staff being appointed;
• Fundamental rethinks of the commercial structures and procurement organisations within departments; 
• The creation of new commercial strategies where they did not previously exist;
• The recognition across all departments for the need to improve collection of management information to assist in more strategic decision-making and monitoring of performance;  
• The implementation of resourcing strategies that address succession planning, recruitment and retention issues where limited resources affect delivery;
• The creation of comprehensive PCR Improvement Plans across departments, covering a wider variety of improvements areas, including Collaborative Procurement.

The OGC and departments will now be embarking on the next wave of reviews based on a self assessment approach. The first round will be launched in the autumn and be completed by the end of 2010. The Home Office, Department for Work and Pensions and the Department of Communities and Local Government are the first departments to pilot this new approach.

This report can be found on the OGC website.

Notes to editors

About Wave 2
From now on PCRs will be based on a self-assessment model. The key features of Wave 2 are:

• Reviews will be based on a self-assessment approach, using the same PCR Assessment Model from Wave 1.  This will allow comparisons to be made between Wave 1 and successive waves; 
• Focused more on benchmarking, KPIs, and performance measurement to validate qualitative evidence - in line with the recommendations contained in the Government Operational Efficiency Programme (OEP);
• Published on the OGC website as for Wave 1.

As in Wave 1, RAG (red, amber and green) scores will still be assigned to the 9 key areas of the model and results will be published. OGC will also offer a range of optional services to help departments complete their Wave 2 self-assessments, such as:

• Assisting departments with the completion of their self-assessment;
• Organising supplier/stakeholder surveys;
• Developing change/improvement plans;
• Leading six month stocktake reviews, which will gather supporting evidence using independent assessors.

About the Operational Efficiency Programme (OEP)
The Operational Efficiency Programme (OEP) identified scope for £15 billion of efficiency savings from back office operations and IT, collaborative procurement, asset management and sales, property and local incentives and empowerment.

The OEP aims to achieve efficiency savings from collaborative procurement of £5.7 billion by 2011-12 and £7.7billion by 2013-14. The £5.7 billion figure breaks down as follows:

• Energy: £320m 
• Fleet: £110m 
• Office solutions: £280m 
• Travel: £240m 
• Professional services: £1,120m
• ICT: £1,570m 
• Facilities management: 540m 
• Food: £90m 
• Construction: £1,460m

The £7.7billion figure includes £1.6 billion of value for money savings that could be achieved through the collaborative procurement of IT.

About OGC

The Office of Government Commerce (OGC) is an independent office of HM Treasury, established to help government deliver best value from its spending. The OGC works with central government departments and other public sector organisations to ensure the achievement of six key goals:

• Delivery of value for money from third party spend;    
• Delivery of projects to time, quality and cost, realising benefits;   
• Getting the best from the government's £30bn estate;   
• Improving the sustainability of the government estate and operations, including reducing carbon emissions by 12.5% by 2010-11, through stronger performance management and guidance;   
• Helping achieve delivery of further government policy goals, including innovation, equality, and support for small and medium enterprises (SMEs);   
• And driving forward the improvement of central government capability in procurement, project and programme management, and estates management through the development of people skills, processes and tools.

OGC provides policy standards and guidance on best practice in procurement, projects and estate management, and monitors and challenges departments' performance against these standards, grounded in an evidence base of information and assurance. It promotes and fosters collaborative procurement across the public sector to deliver better value for money and better public services; and it provides innovative ways to develop government's commercial and procurement capability, including leadership of the Government Procurement Service.

Media Contact:
OGC press office
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F: 020 7271 1345
E: press@ogc.gsi.gov.uk

Contact details:
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E-mail: ServiceDesk@ogc.gsi.gov.uk