NHS procurement streamlined, with announcement of £300m savings

Savings target achieved achieved five months ahead of target

Savings of £300m have been achieved through improved procurement practises

NHS Business Services Authority and NHS Supply Chain have revealed that the £300m cash-releasing savings target set by the Department for Health and Social Care has been achieved five months ahead of plan.

This initiative supports local NHS trusts and forms part of the Carter Initiative, which estimated that £700m could be saved through improved procurement activities.

The key drivers for delivering these savings were:

  • Price reductions: delivered through the procurement teams working with suppliers to achieve price reductions
  • Savings programmes: The NCP programme, which NHS Supply Chain operates on behalf of NHS Improvement and the Compare and Save programme
  • Commitment discounts: retrospective rebates resulting from purchasing commitment from a specific supplier

This model will leverage the collective buying power of the NHS to provide clinically-assured products at the best value while meeting the diverse needs of NHS organisations

Gerry McGeary, head of supplier management at NHS Business Services Authority, said: “This is a significant achievement and I would like to thank everyone who has contributed to its success.

The voice of the customer is important to us and is at the core of the NHS Supply Chain’s procurement strategy which provides products that meet the expectations of our customers while contributing to the delivery of these significant savings.”

Tim Slater, chief executive of NHS Supply Chain, added: “This is a fantastic achievement and I would like to recognise all the hard work that has gone into delivering this £300m cash-releasing target.

“We have worked collaboratively with our customers and suppliers on our savings programmes such as Compare and Save and the Nationally Contracted Products (NCP) programme led by NHS Improvement and this collaboration has been key to achieving this target.”

The team is currently transitioning into the new NHS Supply Chain Operating Model which aims to deliver savings of £2.4billion over the next five years.

McGeary said: “This model will leverage the collective buying power of the NHS to provide clinically-assured products at the best value while meeting the diverse needs of NHS organisations.”

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