In a move expected to save £3 billion a year, Francis Maude has announced that the Government is making significant changes to the way it buys in categories of common goods and services such as stationery and office services.

The move follows Sir Philip Green’s Efficiency Review findings last October that Government could better take advantage of its scale and buying power.

Francis Maude also reinforced the Government’s commitment to buy more of its products and services from smaller suppliers.

Small and medium enterprise (SME) action plans set out how each Government Department will seek to achieve the Government’s overall aspiration to do 25% of its business with Small and Medium sized Enterprises (SMEs).

The plans include the creation of one central team, Government Procurement, which will contract for widely used goods and services for the whole of Government at a single, better price, ending the signing of expensive deals by individual departments. The move will end poor value contracts such as those where government departments and agencies paid between £350 and £2,000 for the same laptop and between £85 and £240 for the same printer cartridge from the same supplier.

Central procurement of common items is expected to save more than £3 billion a year by 2015 – 25% of the Government’s current annual spending on these items, helping departments to meet tighter budgets set in the Spending Review.

Francis Maude said:“It is bonkers for different parts of Government to be paying vastly different prices for exactly the same goods. We are putting a stop to this madness which has been presided over for too long. Until recently, there wasn’t even any proper central data on procurement spending.

“So, as Sir Philip Green found, major efficiencies are to be found in Government buying. The establishment of Government Procurement means that the days when there was no strategy and no coherence to the way the Government bought goods and services are well and truly at an end."