1. Portfolio/Number/Name:H/C1NHS Procurement |
2. Programme/Activity: Please
include a short description As part of NHSScotland's agenda for
Modernising Support Services, SEHD launched
Phase 2 of BPI (Best Procurement
Implementation) in NHSScotland at the end
of August 2003. The scope of the work has
been divided into 4 workstreams,
namely: - Process & Technology -
co-ordinating the rollout of the
eProcurement Scotl@nd service to
NHSScotland (NHS boards and Special
Health Boards);
- Strategic Sourcing - targeting 11
commodities in the 1
st wave and a further 11 in
wave 2;
- Logistics - implementing best
practice supply chain management in
NHSScotland and securing the
procurement benefit opportunities
identified in Phase 1;
- Change Management and Communication
- supporting the changes driven by the
Strategic Sourcing and Process &
Technology streams with a comprehensive
communications programme and a focus on
managing the stakeholders through
supporting and championing the
Programme.
This activity relates to cash releasing
efficiency savings arising from the Process
and Technology and Strategic Sourcing
workstreams. |
3. Planned Savings | BPI aims to stimulate collaborative
buying and thereby deliver sustainable cost
reductions of 50 million per annum. |
| 2005-06 | 2006-07 | 2007-08 |
Cash (m) | 32 | 40 | 50 |
Time Releasing (m) | 0 | 0 | 0 |
4. Accountable Officer for
delivery | Dr Kevin Woods |
5. Project Manager | Mr Ross Scott |
6. EGDG account manager | Ms Gillian Woolman |
7. Quality Impact | Describe any impact on the quality
of service delivery. Be specific and
explain if the expectation is positive,
negative or neutral. The expectation is a positive impact on
quality. Through technology and national
contracts better purchasing at better
prices will be delivered. Better working
practices will be developed and
administrative savings will be delivered
through the reduction in the number of
paper documents (eg purchase orders, goods
received notes, invoices, etc) that will
need to be processed. |
8. Dependencies | Explain if your savings are
dependant on legislation or other
structural changes being achieved. Savings are not dependant on
legislation. Savings are dependent on the
roll-out of technology to NHS Boards and
the identification of commodities and the
development of national contracts. |
9. Description of efficiency and
actions to be taken | 9.1 How will the saving be made? Be
specific about number/size of contracts, staff,
posts dates etc. Savings will be made through the use of
technology (e-procurement), purchasing
through reverse electronic auctions and the
number of national contracts negotiated. As
at February 2005, NHSScotland had
participated in 3 reverse electronic
auctions (two for IT and one for non
sterile gloves) and several others were
planned; national contracts had been
negotiated for 14 commodities and were in
place with a further 7 due to come on
stream by April 2005. A total of 140
commodities has been identified although it
is anticipated that some commodity bundling
will occur. All NHS Chairmen and Chief Executives
have formally signed up to the objective of
ensuring that their Board participates
actively in the strategic sourcing and
e-procurement facet of BPI. Furthermore,
each Board has given an Executive Director
specific responsibility for BPI. |
9.2 What action is critically needed to
secure delivery of this saving? Be specific,
and name the key action managers if they are
outwith your immediate management chain (e.g.
in an NDPB.) The action required is that the
technology is rolled out by the project
team; national contracts are negotiated by
the project team; and that NHS Board Chief
Executives and Heads of Procurement ensure
that the contracts are used within their
Boards. BPI is a business change programme
and success is tied to the degree to which
structure and practice changes. There is,
therefore, a key dependency on NHSScotland
participating in the programme and taking
responsibility for implementing business
change in that environment. The Change
Management and Communication workstream of
BPI is important in this respect. |
10. Impact on Staffing to achieve the efficiency
gain | If there are to be any changes in
staff numbers (at activity level) to
achieve the efficiency gain, please
indicate how many full time equivalents and
how far you expect savings to be achieved
by natural wastage (show additions as + and
reductions as -). |
| 2005- 06 | 2006- 07 | 2007- 08 |
+ | 42 | 42 | 42 |
- | 0 | 0 | 0 |
Net | 42 | 42 | 42 |
Explanation | The need to recruit an additional 85
staff was recognised to deliver the cash
releasing efficiency savings. Of this
figure 16 are required to make up a current
staffing shortfall and 27 will be on fixed
term contracts primarily concentrating on
implementation. This means a net addition
of 42 permanent people to provide ongoing
leadership, strategic sourcing, systems
management/development expertise. It is
anticipated that 36 (of the 85 staff) will
be recruited in 2004-05. |
11. Benefits | In general, the benefits of the
Scottish Executive Efficiency Plan are the
enhanced outputs from the resources
Ministers have been able to allocate in
SR04. But if there is a direct connection
between this efficiency saving and the
enhancement of a particular service please
describe it here. The cash releasing efficiency savings
will be retained by NHS Boards and used for
developing and/or delivering local patient
services. |
12. Gross/Net Cash Savings | 12.1 Please set out the gross recurring
saving and any offsetting recurring
expenditure. The gross recurring saving is 32m pa
and rises to 50m in 2007-08. This saving is
net of the costs of additional staff. |
12.2 Against what budget does this saving
fall? NHS Board Revenue Allocations |
12.3 Has this saving been built into your
budget? No |
12.4 If so, what is the maximum allowable
expenditure against the published budget data,
in each year, for that saving to be
delivered? N/A |
12.5 If not, how do you propose to invest
the additional cash back into public
services? Higher investment in NHS services since
the savings are retained locally within NHS
Boards. |
12.6 What plans do you have to exceed the
required saving? Explain by how much in each
year? (Answer here also if you need to do this
to live within your budget) None |
13. Time - release savings | 13.1 Please explain any time-releasing
savings indicated at question 3. N/A |
13.2 Please describe the method you
plan to use to calculate the cash
equivalent of those time release
savings. N/A |
14. Measurement and
Monitoring | 14.1 How are you proposing to measure the
expected efficiency benefits (e.g. in terms of
costs, level of output or quality of
service)? Savings delivered through BPI against
existing commodity expenditure
baselines. |
14.2 What monitoring & reporting
procedures will be put in place to measure the
efficiency savings (How often will progress
towards the target be monitored? Monthly reporting by the BPI Project
Team Who will have lead responsibility
for reporting progress and what procedures
will be in place?) BPI Project Director |
14.3 Monitoring Data: Sources, validation
and risks - What data will be used to measure
progress?
Procurement data
- Is all the required information
quantifiable and readily
available?
Yes
- If not what action will be taken to
rectify this?
N/A
- What measures will be in place to
validate the accuracy of the data?
To be determined.
- Who will take responsibility for
this?
BPI Project Director
- Are there any issues or risks
relating to how you plan to use the data?
(e.g. accuracy, difficulties in
collection).
No
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