London Procurement Partnership – Members’ Event and What Made Us Go “Wow”!

Yesterday I was speaking at the London Procurement Partnership (LPP) members’ conference, a well-attended event, with close to 100 people on the 29th Floor of Guys Hospital - and views as spectacular as anything you well find in London.

LPP is a not for profit, members-led collaborative procurement body, covering in the main the London region. LPP is one of four such entities in England, along with NHS Commercial Solutions, NHS North of England Commercial Procurement Partnership and East of England NHS Collaborative Procurement Hub.

Rather than giving you a blow-by-blow account of the day, let's just pick up for today on some of the "I didn't know that," and "good heavens, that is amazing" moments from the various sessions. We will be back next week with our thoughts on the speech from Lord Carter of Coles (pictured here), who is the Chair of the Procurement and Efficiency Board - the Procurement Czar as I like to see it. But a sneak preview – I thought I might disagree with some of his views, from bits and pieces I had heard, but actually he was very good. More on that to follow.

So, what did we learn yesterday, at a well run and useful event?

  • Rob Knott from the Department of Health is leading the work on the new “operating model” for procurement in the NHS, including the NHS Supply Chain strategy and what will replace the current DHL contract. He indicated that there may be news on that as early as June - that would be sooner than I expected.
  • The Department of Health is forming a Procurement Advisory Board, bringing together a collection of around a dozen Trust procurement leaders, head of function and equivalent, to work with DH on the operating model, which seems very sensible.
  • Of the 551,000 different items (SKUs) listed in the DHL NHS Supply Chain catalogue, only 128,000 were actually bought by anyone last year! So that is over 75% not even purchased once.
  • Over 70% of the medical locums (doctors employed for short-term work by Trusts in the LPP region) are employees of other Trusts! They are what we might simplistically call “moonlighting,” the vast majority (over 90%) through their own limited companies rather than PAYE. And their principal employers in most cases don't even know what they are doing. That was a real "wow" moment. And not necessarily in a good way.
  • So LPP is looking at whether it might take a more active approach in this medical locum market - that is a real challenge but LPP has some interesting ideas and we will follow their progress with interest here.
  • Soft FM bought via PFI schemes (i.e. where it was rolled into a PFI contract) is costing Trusts on average 15% more than where it is bought outside PFI. The PFI provided services get a very slightly higher quality rating (just about 5% better). LPP is helping members negotiate with PFI providers to drive value improvements in this category, with some success (but lots more to go for!)
  • There is huge variation when we look at efficiency measures within Trusts - one employs 450 people in its pharmacy department, far more than the average, for instance.
  • Savings of over 60% have been made in certain spend categories by going to the market with guaranteed and committed volume (compared to catalogue pricing), and using reverse auctions. Yes, 60%!
  • Implementing GS1 and PEPPOL is progressing slowly and is proving a lot harder than expected - or certainly harder than the Department of Health expected.

So well done to LPP and the organisers, and more on Lord Carter next week.

First Voice

  1. Sam Unkim:

    •Implementing GS1 and PEPPOL is progressing slowly and is proving a lot harder than expected – or certainly harder than the Department of Health expected.

    DOH adopts “big bang “roll-out of untested technology in Cinderella depts. ( Supplies.. it’s 1st left behind the boiler house), asks overspent £££>Trusts to fund it & monolith ERP providers to “please” integrate with it.

    All be in by Xmas

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