Industry news

The public sector, including the Cabinet Office and the Treasury, has come under criticism from the Public Accounts Committee (PAC), with a report saying that they “failed to achieve best value for taxpayers”.

The report identified key weaknesses in the current system, despite praise for the move to centralise procurement. The report identified that independence in departments for spending decisions meant that they were reluctant to give power to a centralised system, which in turn resulted in incomplete procurement data, hindering the Government Procurement Service.

The report also said that the government still had room to improve, when encouraging SMEs to bid for outsourced services, despite recent measures.

Margaret Hodge, PAC chairwoman, said: “The centre of government should be more forceful, rather than simply relying on encouragement and persuasion to get departments to alter their behaviour.

Prime Minister acknowledges public sectors shortcomings when outsourcing

New public sector rules focus on encouraging SME procurement

U.S. bank JP Morgan Chase has increased its IT investment in analytics and data in order to improve compliance controls.

JP Morgan chief executive Jamie Dimon, said that the bank had increased spending on technology by 27 per cent since 2011 to meet regulatory requirements, with around $1 billion spent in 2013 alone. JP Morgan has also increased its IT workforce by 4,000 staff since the start of 2012.

Investment had been focused on data analysis, control reporting and collecting relating to risk.

The move to develop IT to improve compliance comes after recent trading investigations, with the bank currently preparing to settle with the Federal Reserve and Securities and Exchange Commission (SEC) for $800 million relating to a loss of $6.2 billion in 2012.

Mr Dimon said: “Never before have we focused so much time, effort, brainpower, technological power and money on a single, enterprise-wide objective”.

Genpact partners with Markit to development screening checks

U.S. based chemical manufacturer Ferro expects to save $100 million through the standardisation of procurement processes.

The chemical firm has selected Capgemini and Procurian to help transform indirect spend, with Capgemini providing back-office procurement standardisation, while Procurian will provide management services, including planning, compliance and contracting tools.

The standardisation of services is expected to create significant savings from Efficiency over time.

Peter Thomas said: “The benefits we expect to achieve in our indirect spend procurement function give us further confidence that our cost-saving initiatives will generate savings greater than $100 million”.

Wax Digital wins software contract to the States of Jersey

New procurement rules have been announced by the Cabinet Office, with the aim of helping SMEs win increased business within the local public sector, as the government seeks to improve competition and savings through SME service tenders.

A consultation will be run until mid-October, regarding the proposed changes to increase the numbers of SMEs in public procurement, and reduce the dominance of large traditional firms.

Cabinet Office minster Chloë Smith, said: “With £230 billion per year spent on goods and services right across the whole public sector, government wants to seize the opportunity to help hard-working SMEs”.

SMES to receive lending boost

SMEs forced to adapt to economic pressures

The NHS Shared Business Services has secured a single supplier framework for the NHS in England and Wales.

The five-year £4.6 million framework agreement has been awarded by the Staffordshire and Stoke on Trent Partnership NHS Trust and is aimed at saving NHS organisations time and money through efficiency savings.

The Trust estimates that the transfer of these three non-frontline services to NHS SBS will achieve savings of around £880,000 throughout the life of the contract.

John Neilson, Chief Executive of NHS SBS said: “Securing this agreement is a great achievement for NHS SBS. Importantly though, it offers a significant additional benefit to NHS providers both at the stage that they’re procuring shared services, and then through the sizeable efficiency savings we can achieve following the integration of our three core services.”

Gloucestershire NHS Trust puts out tender for information system

NHS Trust signs seven year ITO deal with CGI

MPs on the Government’s public account committee (PAC), have said that they expect costs for the abandoned NHS patient records system to rise above the current bill of £9.8 billion.

The project originally launched in 2002 was impacted by obstacles including supplier disagreements and technical challenges, resulted in missed deadlines as costs spiralled.

Committee member Richard Bacon described the program as: “one of the worst and most expensive contracting fiascos in the history of the public sector.”

Despite acknowledgement from within the public sector of, the need to improve procurement management, Mr Bacon added that “there is still a long way to go before government departments can honestly say that they have learned and properly applied the lessons from previous contracting failures."

Prime Minister acknowledges public sectors shortcomings when outsourcing

Public Accounts Committee attacks NHS & CSC patient record system

Accenture has acquired a majority stake in Vivere Brasil, as the outsourcing company looks increase services in Brazil’s rapidly expanding economy.

The purchase of Brazilian based Vivere Brasil, which provides mortgage processing services, will expand Accenture’s own mortgage service capabilities while increasing efficiencies and enhancing Accenture’s position in the country as the domestic mortgage market increasingly develops.

Mortgage loans in Brazil currently represent 7.4 percent GDP, with the mortgage market expected to grow to 10 percent of GDP by 2015, having experienced 41 percent compound annual growth since 2007.

Luis Simões, a managing director in Accenture’s financial services practice in Brazil, said: “As demand for home loans grows, Brazil’s banks will require ever-greater mortgage-processing capacity, efficiency and quality controls in order to compete”.

Experian expands further into Brazilian markets

Lenovo buys Brazilian CCE for $148 million

The Public Accounts Committee (PAC) has been called a failure in the latest report from the committee, after only 2 per cent of items where purchased through the procurement hub.

The hub, which is used by 43 police forces across the UK, was targeted to deliver 80 per cent of procurement services for UK police forces by 2015.

The committee also criticised the lack of data being delivered by police forces regarding their procurement spend. The quality of data is seen as vital to the Home Office’s efforts to develop savings and increased efficiencies.

PAC chairman, Margaret Hodge, said:” “National contracts with suppliers are not used by enough forces and do not cover many basic goods and services. Forces’ use of the new, online police procurement ‘hub’ is also woefully below the Home Office’s expectations. By 2013, a miniscule two percent of items were being bought through this central hub, against a target of 80 percent by the end of this parliament.”

BT awarded police PSN contract

Accenture secures bid for New National Information Management System for Police Scotland

The states of Jersey have awarded Wax Digital a contract to implement procurement software within the public sector.

The contract will see Wax Digital supply its web3 Purchase-to-Pay (P2P) procurement software solution, which is designed to enable more efficient purchasing and improved supplier management and also provide increased visibility of public expenditure.

Wax Digital web3 will be used by up to 2,000 of the States of Jersey’s employees to improve purchasing across all ten of the States’ departments including Education, Health, Social Services and Home Affairs.

The software is to be integrated with the States’ existing accounting software to facilitate the payment of over 3,500 invoices a week.

Director of Strategic Procurement, States of Jersey, Caroline Hastings, commented: “We are very excited about working with Wax Digital to make further improvements to our procurement system. This is a major project for the States of Jersey and the ease-of-use of web3 was a key factor in us choosing Wax Digital as it will mean that people using the system will be able to make purchasing efficiencies from the outset.

Many of the people who will be using the new software have already been involved in a number of workshops led by Wax Digital to ensure all our requirements are met.”

Business development director, Wax Digital, Daniel Ball, added: “We are absolutely delighted that we will be working with the States of Jersey to help them achieve further efficiencies and savings using web3. The software offers complete transparency throughout the purchase-to-pay process and will integrate with its existing software systems.”

Public and private sector outsourcing challenges

Smart meter manufacturer Landis+Gyr have been awarded a £600 million contract by British Gas to provide smart meters to the energy giant.

The contract comes as British Gas moves to install smart meters in 16 million homes as energy giants update monitoring infrastructure throughout the UK.

The contract with Landis+Gyr is expected to improve the speed of the smart meter rollout while reducing costs.

The smart meter rollout, which is being pushed by the government, is set to place energy smart meters in all homes and businesses across the UK by 2020.

British Gas has already started to install smart meters, with one million having been already installed in sites across the UK.

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