Out-Law News 2 min. read
24 Jul 2013, 4:41 pm
Cabinet Office Minister Francis Maude said that the new arrangements would deliver savings to the taxpayer by maximising the Government's negotiating position and raising its commercial capability.
The new unit, which is intended to fulfil the Government's commitment to civil service reform, will be established in the autumn, he said.
"The new Crown Commercial Service will ensure a step change in our commercial capability, given government a much tighter grip on all aspects of its commercial performance, from market engagement through to contract management," he said.
"Commercial reforms are a key element of our Civil Service Reform programme. To win the global race, Britain needs an exceptional civil service with strong commercial acumen. We need the best, most cost-effective public services in the world," he said.
The Crown Commercial Service will bring together the existing Government Procurement Service and other Cabinet Office teams into one commercial unit, which will act as a "true single customer". It will initially manage the purchase of common goods and services such as professional services and energy, with "strategic" and specialised purchasing left to individual departments.
A new Complex Transactions Team will be introduced as part of the new unit. Its job will be to work with departments on more complex procurements, reducing the need for independent advice. The Crown Commercial Service will also work closely with the wider public sector to assist in implementing centralised procurement arrangements more widely.
The development of the existing Government Procurement Service has already resulted in savings worth £3.8 billion to the taxpayer, according to Cabinet Office figures. However chief procurement officer Bill Crothers said that with total spending of around £45bn on goods and services, there was the potential for the Government to become even more efficient.
"The Crown Commercial Service will ensure we act as a true single customer: buying the essentials for the whole of government in the most efficient way possible, whilst freeing up departments to focus their procurement expertise on what is unique to them," he said.
"The result will be more savings, an increase in the quality of the commercial service to government, and a sustainable approach to our commercial and procurement activity which will benefit the whole of the public sector," he said.
Public sector contract negotiations expert David Isaac of Pinsent Masons, the law firm behind Out-Law.com welcomed the creation of the new body, but said that it would have to be sensitive to "already complicated" legacy arrangements.
"Consolidating the very significant spend across central Government must be right in terms of saving costs and securing economies of scale," he said. "What this new body needs to be sensitive to is that legacy arrangements are already complex, and given the complexity of the challenges facing departments commoditised solutions don't always work."
