£300m procurement saving for NHS

The National Health Service has achieved £300 million procurement saving five months ahead of target, according to NHS Business Services Authority and NHS Supply Chain.

The target, set by the Department for Health and Social Care, forms part of the Carter Initiative which estimated that £700 million could be saved through improved procurement activities.

“I would like to recognise all the hard work that has gone into delivering this £300 million cash releasing target, said Tim Slater, chief executive officer at NHS Supply Chain, which is part of DHL.

“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.”

There are three main areas of savings:

– Price reductions delivered through the procurement teams working with suppliers.

– Savings programmes, notably the NCP programme, which NHS Supply Chain operates on behalf of NHS Improvement and the Compare and Save programme.

– Retrospective rebates resulting from purchasing commitment from a specific supplier.

Gerry McGeary, head of supplier management at NHS Business Services Authority said: “We are currently transitioning into the new NHS Supply Chain Operating Model which aims to deliver savings of £2.4 billion over the next five years. 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.”