The government underlined its plans for increased use of e-procurement systems and shared service centres across the public sector this week, despite concerns of some suppliers and local government IT chiefs.
Speaking at the annual Government Computing Expo in London, Stephen Timms MP, the recently appointed chief secretary to the treasury, said he was impressed by the savings delivered to the public sector by e-procurement systems. He said the average e-auction cost £10,000 to carry out, but delivered savings of £800,000.
Timms claimed that there was "more scope" for use of e-procurement systems as the public sector aims to cut procurement costs by £8bn by 2008. He added that he would push for wider use of the technology.
However, the commitment to e-procurement prompted criticism from leading IT suppliers who argued that while such systems provide a useful audit trail for public sector officials the technology is rarely sophisticated enough to cope with complex technology deals. "They are very frustrating to use," complained a spokesman for one major government IT provider. "I've been in meetings where we've been told what is important to the project but then there is nothing about it on the electronic form."
A spokeswoman for another major IT hardware supplier said that despite government claims, relatively few agencies are using e-procurement. "Some councils are doing everything online, but there are few shining examples," she said. "The systems aren’t good enough yet and there is a sense among procurement professionals that they will lose their job [if they implement these systems]."
But Miranda Carruther-Watt, director of modernising services at the North West local government centre of excellence, argued that suppliers’ opposition is based on a fear that e-auctions will drive down prices. "We saved over £12m last year through e-auctions," she said. "The technology is new and hasn't been used for many big procurements yet, but I see no reason why it shouldn’t be."
Elsewhere at the event, Colin Whitehouse, senior e-government advisor for the Department for Communities and Local Government – formerly the Office of the Deputy Prime Minister - highlighted the progress made by the government's Transformational Government strategy. He claimed there was growing support for government plans to get councils to work together to develop shared service centres to perform back-office functions such as IT support.
"We are seeing local authorities say 'we can't do this effectively on our own – how do we go about working with others to improve?'" said Whitehouse. "[There is a realisation] that it is crazy for councils to do the same thing 388 times. "
However, several critics said transformational IT projects and adoption of
shared service centres were being hampered by recent delays to the government's
local government white paper that is expected to recommend significant changes
to the way councils are organised and run.
Glyn Evans, director of business solutions and IT at Birmingham City Council,
said that the council had made great progress in delivering efficiency gains
through its recent joint venture with services giant Capita. But he admitted the
uncertainty caused by the white paper was distracting. "People won't be focused
on transformation if they are worried about their future," he added.
But Carruther-Watt insisted there was no reason for concerns about the white paper to delay any IT projects. "It is a concern [for people], but the efficiency principles around shared service centres and other transformational projects are the same whatever the new [council] structure [ends up being]," she said.
