E-auction halves government IT costs

Public bodies save £7m on IT hardware through online supplier auction

The Office of Government Commerce (OGC) completed its latest e-auction for the procurement of public sector IT equipment last week, delivering savings of nearly £7m.

The 14 local councils and six NHS Trusts involved required £13.7m of IT hardware at pre-auction benchmarked prices, but at the end of the five-hour online auction, which saw suppliers bid for the contracts, they had secured the kit for £6.9m – an average saving of 50 percent across the six lots.

The OGC said that the latest auction took the number of public sector bodies that have participated in the scheme to 325, delivering savings of £21m since the first auction in 2005. It added that the scale of the latest savings demonstrated the success of both e-auctions and its strategy of encouraging greater collaboration between separate public sector IT departments through both shared service centres and shared procurement.

"The e-auction has delivered an extremely competitive deal, demonstrating the huge benefits that can be obtained by working collaboratively to engage with suppliers," said Chris Chettle, OGC e-auction manager. "These councils and NHS trusts have together achieved far greater price reductions than anything they would have obtained by each negotiating with the suppliers on an individual basis.”

Rob Leak, chief executive of the London Borough of Enfield, one of the participating councils, said he was delighted by the savings the e-auction delivered. "I am eager that the collaborative approach extends to other high-value commodities and services," he added. "I am sure that there are even more savings to be exploited across London by working together and influencing markets.”

The OGC added that it was keen for more public sector bodies to sign up to future e-auctions, and urged public sector IT chiefs to contact the OGC or their local government centre of excellence about joining the scheme.