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Renfrewshire Council saves £21 million through procurement overhaul

17th Feb 2014
Renfrewshire Council saves £21 million through procurement overhaul

A council buying department has raised itself from a capability score of 21 per cent to the highest scoring local authority in Scotland in the space of four years.

Renfrewshire Council received its low score in 2009 under a Procurement Capability Assessment (PCA) carried out by Scotland Excel, a not-for-profit local government procurement organisation, but by overhauling processes and centralising functions it reached 80 per cent in 2013.

The work has also seen savings worth millions of pounds each year, with £20.9 million saved over four years.

Julie Welsh, head of procurement and business support, was appointed in 2009 from the private sector to turn things around. “This was new territory for me,” she said. “I set about centralising the procurement function, revising all the procurement policies and processes.”

When Welsh arrived there was a central purchasing department, but it had a mainly advisory and transactional role, taking care of spend around consultancy, financial services and IT. Most of the big ticket purchasing, such as social care, took place in departments.

Welsh established a procurement transformation team including herself, heads of service and senior management, to drive change, and each year their PCA score climbed.

She said: “It feels like we started from scratch. I wrote a procurement strategy for the council for two years. It was mainly around standardising processes, making sure everything was compliant and efficient.

“I realised I would not be able to deliver the savings the council wanted with the structure we had."

Welsh set about centralising buying at the council, which has an annual procurement spend of around £200 million, growing the purchasing team from 12 to 32 but having to tackle some resistance from stakeholders.

“The savings were down to the focus that had not been there before,” she said. “Our internal customers did not exactly welcome us with open arms.”

The department now deals with spend across a range of categories including construction, capital investment programmes, IT, social care and adult care services.

However, the challenge Welsh now faces is finding the right staff, with expanded public sector purchasing departments sucking up candidates.

“There is just not enough people. Procurement has grown in the public sector,” she said.

To read more: http://www.supplymanagement.com

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