Press Releases

Angela Eagle challenges government departments to buy into eAuctions

Exchequer Secretary to the Treasury and Procurement Minister Angela Eagle is asking government departments and agencies to club together to buy more goods and services through internet-based eAuctions.

With challenging new Public Service Agreements and value for money targets set in the 2007 Comprehensive Spending Review, government departments will have to be increasingly resourceful in looking for ways to buy what they need for less money.  

Collaborative online auctions, in which organisations pool their requirements and invite suppliers to bid down the price, while maintaining quality, have proved to be an excellent way of getting better value for money, with savings achieved of up to 50% compared to the price an individual organisation might pay without an eAuction.

Angela Eagle is making the challenge after attending a live eAuction for IT hardware recently, in which twenty-four organisations from across the public sector together bought laptops, PCs, monitors and other equipment, saving £5.2 million for the taxpayer. The auction, which lasted three hours, was part of a rolling eAuction programme sponsored by the Office of Government Commerce, an office of HM Treasury.

Angela Eagle said: "Innovation in the way government buys goods and services is key in securing value for money alongside world class service delivery.  I am calling upon all departments and agencies to look at how they might use eAuctions as part of their procurement strategy and how they can make even greater value for money savings by joining up with other organisations to buy collectively."

Notes to Editors

About eAuctions

The eAuctions run by OGC are 'reverse' auctions, so suppliers are bidding decreasing prices for the contract offered. Tenders are assessed in advance against all relevant criteria, from which a provisional ranking is formed. During the auction, which is conducted online using specialist software, sellers continually lower their prices in response to competitors' bids. Only the buyer can see who is offering each price. After the auction has closed, the final contract will be chosen, taking into account both the price offered and the previous evaluation.

Earlier this year, the largest ever UK public sector collaborative eAuction took place, involving seven central government departments and agencies and the Metropolitan Police. The eAuction for stationery and office supplies lasted only 14 hours but will potentially save the taxpayer £100 million (an average of 43% compared to benchmark prices) over the next three years.

About OGC

The Office of Government Commerce (OGC) is an office of HM Treasury, responsible for improving value for money by driving up standards and capability in procurement, from commodities buying to the delivery of major capital projects, maximising the effective use of 60% of Government spending and a £30 billion property estate.

A new Government strategy launched in January 2007, Transforming Government Procurement, highlighted the central importance of procurement in delivering high-quality public services and best value for money.  OGC is tasked with delivering this transformation, and with driving up standards and procurement capability across central Government.  The OGC will do this through:

• Setting procurement standards and monitoring performance and capability;
• Developing a cadre of skilled procurement professionals across Government;
• Driving value for money through collaborative procurement;
• Playing a stronger role in the successful delivery of major projects;
• And improving management and use of the Government estate.

Media Contact:
Michael Dunning, Media Relations Manager
T: 020 7271 1318
F: 020 7271 1345
M: 07771 815245
E: michael.dunning@ogc.gsi.gov.uk