Cabinet office minister Francis Maude put pressure on suppliers who resisted initial efficiency negotiations, according to a senior civil servant.
Ian Watmore, the chief operating officer of the Cabinet Office's Efficiency and Reform Group (ERG), addressed the House of Commons Public Administration Committee on the issue on 28 October 2010. He said that when the government held efficiency talks with 19 of its top suppliers, there were occasions when cabinet minister Maude had to intervene.
He stressed that the majority of negotiations went well, but admitted there were instances when his group failed to reach initial agreements with vendors.
"On the one or two occasions it seems to have been slow with the company – they haven't quite 'got it' to use the phrase – then we have brought them in and he has put more pressure on them to go back and think again," Watmore said of Maude.
When asked about other ways in which the ERG put pressure on when renegotiating contracts, Watmore said that he pointed out discrepancies across departments to suppliers.
"What he said to them – there are limits to what we can do legally because usually we have got contracts that are multi-year and binding – but what we have said to them is two or three things. The first thing is we can now see the discrepancies in the way you're doing business with government. We've joined ourselves up and we can now see these: put it right. The implication being if they don't, we will take a dimmer view of them in the future. They might be able to hide legally behind a contract, but they will have pressure on them in the future," Watmore said.
"Secondly we have asked them to come back to us with suggestions where they can just reduce their bill, either by not doing something because they think it is unnecessary or ... as I put it to them privately, 'you've spent the summer telling me that something must be done about government finances, well now we are asking you to do something about government finances and contribute yourselves' – which they are doing."
He said the final thing being asked of suppliers was their ideas about how things could be done better in the future.
Watmore also told the select committee that if he were a supplier he'd be "relatively embarrassed" by the inconsistent delivery of services across departments and that he'd make necessary alterations for that reason.
He also said that he was fully behind Philip Green's review of government spending. "The central thrust of Philip Green's review, which I agree with, is if you want to get maximum bang for the buck, as the Americans would say, from this you have to take certain categories of purchasing and do them once on behalf of government," Watmore explained.
Bulk purchasing would give the government more buying power and ensure better consistency across Whitehall, he added.
The Cabinet Office has signed a number of memoranda of understandings with top suppliers to support the government's drive to make efficiency savings.
This article was originally published at Kable.
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