1 The Crown Commercial Service (CCS) is a government agency and trading fund. It delivers services such as advice on complex procurement, commercial capability development, the creation and management of procurement frameworks and buying services for central government and public sector organisations. CCS is directly responsible for buying around £2.5 billion of goods and services for central government departments.
It also manages buying frameworks that help departments and the wider public sector to purchase £12.8 billion of goods and services. This report focuses on CCS's buying of common goods and services and its management of procurement frameworks.
2 The rationale for buying common goods and services centrally is that these are commodities, where price is more important than differences in quality, and the government can achieve value for money by buying in bulk. However, previous attempts at central buying and other programmes to establish centralised or shared services have run into difficulties. These have included agreeing realistic deadlines and targets, developing detailed plans based on accurate data and establishing cross-government governance and customer buy-in.
3 We last reported on the need for a cross-government approach to procurement in 2013. We said that:
"There is now a mandate for departments to comply with the centralised approach, but this is not enforced in practice, with no sanctions for non-compliance. Either the Cabinet Office will need to create more potent levers, or it will have to win 'hearts and minds', and demonstrate that it has the capability and capacity to deliver a high-quality central procurement function"1.
4 The government launched CCS in April 2014 by transferring some of the staff who were responsible for buying common goods and services from government departments to the existing Government Procurement Service. The government gave CCS a stronger mandate and told it to buy common goods and services directly, rather than departments buying through CCS frameworks themselves. The Cabinet Office expected CCS to achieve significant benefits. It forecast net savings of more than £3 billion over the first four years of operations.
5 By 2015, the programme to centralise the purchase of goods and services was widely acknowledged to be in difficulty. As the extent of these difficulties became clear, CCS suspended the transition programme and the Cabinet Office appointed an independent expert to review CCS and to reset the way it undertakes its business. That reset is currently under way and in November 2016 the independent expert was appointed CCS chief executive.
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1 Comptroller and Auditor General, Improving government procurement, Session 2012-13, HC 996, National Audit Office, February 2013.