Councils expect their efficiency savings in the current financial year to fall short of the government target - after comfortably exceeding last year’s goal.
Latest figures from the Communities and Local Government department (DCLG) show that local authorities expect efficiency savings to reach £3.1bn by March 2010 - the end of the second year. The expected total was £3.2bn.
Councils surpassed their targets in 2008-9 by registering £1.76bn worth of value-for-money savings.
Local government has an overall target over three years of £5.5bn - increased from an initial figure of £4.9m.
Communities secretary John Denham told MPs: “I want to ensure that councils are performing as efficiently as possible and making the best possible use of every pound of council tax.
I am pleased to be able to confirm today that councils have forecast efficiency savings of over £3bn by March 2010, making good progress towards the target of £5.5bn by March 2011”
The recent economic turmoil not only forced many small and large companies in the private sector to rethink their cost management strategies, but also prompted governmental bodies and not-for profits to emphasise agility and be more efficient.
The current climate has meant local authorities have been hard pressed to “do more with less.” With this backdrop, it not surprising for public sectors to follow the lead of private companies in using advanced Sourcing and purchasing technologies hitherto available only to large organisations to drive down cost and improve efficiency.
More and more public sector and governmental agencies are using the power of E-procurement delivery platforms to achieve significant savings that can then be put to work in other areas. And the added intangible is that it also makes the Sourcing process more transparent.
James Samuels, CEO of Claritum Said - “We’re seeing huge demand for our SaaS spend management application from private and public sectors. The combination of spend analysis, sourcing, e-procurement, supplier network and catalogue delivers significant and measurable benefits.
Our clients love the quick ROI and the significant hard cash savings. Clients such as the London Borough of Enfield, Ealing and Greenwich have announced 17-25% savings and there’s more to come”