North-west claims savings from using IT

Ian Brown told a Guardian conference that an e-procurement system, the use of enterprise resource management software and collaborative buying have produced significant financial benefits for the region's local authorities. He said they have cut nearly a third from IT hardware costs through a combined contract procured by the North West Procurement Hub. "Got to be honest, it was one authority paying about £1,000 a laptop that generated most of those savings," he told the Guardian's Public Procurement North event in Manchester on 17 February. Altogether, the regional body reckons to have saved its 47 local authorities £69m. Brown said one of the main ways it had saved money was through sharing best practice and through standardising specifications - the region originally had 150 different specifications for road surfacing, for instance, Brown told delegates. The North West Centre of Excellence has established a fully electronic regional tendering system, the Chest (https://www.thechest.nwce.gov.uk/), through which 30 councils have posted more than 1,500 tenders worth in excess of £2bn. Brown said this helps smaller firms bid for council work, which can help regeneration. "We're getting a bigger supply base in Manchester. They are winning because of their location," he told the event. The authorities have recently developed the Chest so that fields are automatically completed based on previous tenders, making it quicker and cheaper for firms to bid for work. He added that Manchester had used its SAP enterprise resource management system to analyse the spending of its top suppliers by ward, and had found that 86% of the money it passes to its top 300 suppliers is spent within the north-west, with more than 50% within Manchester itself. It also found that more than 5,000 Mancunians are employed by these suppliers. The analysis also helps to identify parts of the city that do not benefit from such spending. Brown said this is part of a trend in which better information about spending and greater collaboration across the region had given councils in the north west the confidence to form a united front and get much better deals on a wide range of goods and services, from road surfacing to foster care services. Councils in the region work together on procurement through sub-regional hubs, based broadly on the old county council areas: Cheshire, Cumbria, Greater Manchester, Lancashire and Merseyside. This enables closer co-operation at a more localised level, and should also allow co-operation on procurement to continue if funding for the regional group expires. Information is key, added Brown. He said that the 10 unitary authorities that make up the Association of Greater Manchester Authorities (Agma) have established their own spending analysis system, which has meant they no longer have to buy such services from external suppliers. "A lot of authorities are using it to meet the transparency agenda," he said. "It put us in the front seat for the £500 spend," referring to the government's requirement for councils to publish all spending above that amount. Use of the system has now spread beyond Greater Manchester, and is used by 17 authorities in the region, with 20 more interested. Within Agma, it is being used to compare the deals suppliers have with each member council, with the intention of negotiating joint deals at a lower price in future. This is expected to save £25m over the next three years, Brown said. This article is published by Guardian Professional.