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13.12.16

NAO slams CCS for ‘severely’ underestimating joint buying difficulties

Central government has not achieved value for money from Crown Commercial Service (CCS) deals, with the Cabinet Office “severely” underestimating the difficulty of implementing joint buying practices across government, the National Audit Office (NAO) has reported.

The CCS is directly responsible for buying around £2.5bn of goods and services for central government and public sector organisations. However, while the NAO found that the CCS helped public bodies save £521m last year, it was uncertain whether these savings would have been achieved anyway if departments had retained their buying functions, due to these savings not being directly comparable to the benefits which were planned. 

The auditor criticised the CCS for a “rapid erosion in departments’ confidence” in its work, with the CCS’s new management accepting that it has not achieved its original expectations. By 2016, only seven government departments elected to transfer their responsibility for buying goods and services to the body, amounting to £2.5bn, well below the anticipated £13.4bn.

Amyas Morse, head of the NAO, said: “Without a sound overarching business case or a detailed implementation plan, it is not surprising that the CCS rapidly ran into difficulties and soon had to reset its plans.

“It is particularly disappointing that the Cabinet Office has not tracked net costs and benefits. Because of this, it is not possible to show that CCS has achieved more than departments would otherwise have achieved by buying common goods and services themselves.”

The NAO found that CCS services were often not integrated or standardised, occasionally using outdated frameworks, meaning that it could not demonstrate to its customers that its deals were the best available. This led to some departments complaining that CCS services were of poor quality.

Despite these criticisms, the NAO reported that the strategic argument for joint buying “remains strong” and that the CCS has recently improved in its governance and its internal controls, which have been “generating goodwill” amongst previously dismissive departments.

“For central government to achieve value for money from its common goods and services, it needs to finish the centralisation it began in 2014,” the auditor concluded.

“The events of the last two years have shown that, in practice, joint buying needs both a mandate and goodwill from departments.”

The NAO has recommended that the Cabinet Office reiterates the mandate for the CCS in central government, and is clear in reminding departments of their expectations to transfer their buying of common goods and services to the body.

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