Count pennies, not just pounds

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A local cost management expert believes the Government’s public spending review announced today needs to live up to its name and ensure that the spotlight is put on costs across the board and not just the big ticket items.

The Chancellor George Osborne today announced a series of measures as part of the biggest set of sending cuts since the war. Departmental budgets have only been cut by 19%, however, where a 25%  cut had been expected, thanks to additional £7bn culled from the welfare budget.

Says, Harry Duff, a consultant with Expense Reduction Analysts, a cost, purchase and supplier management consultancy, who has worked with a number of organisations in Cornwall: “The Comprehensive Spending Review today highlights the areas where the biggest cuts have been made.

“However, based on our experience of helping organisations make cost savings, there is a need to focus on all expenditure areas, big and small. Indeed we have found that it is the seemingly inconsequential costs, such as business travel, postage, waste, photocopiers and stationery, as highlighted in Sir Philip Green’s Efficiency Review for the Government that tend to go under the radar. However it is these areas, again as revealed by Green’s report, which represent significant cost saving opportunities for the public sector when totted up.

“It is therefore imperative that the public sector in the south west drills down deep into their organisations to reduce their cost base – nothing should be left unaccounted for.

“This Spending Review should only be viewed as a starting point. To maximise and sustain cost savings in the long term, the public sector in (locality) will need to set up robust processes and contracts, which ensure forensic examination of all cost areas, effective benchmarking against market prices for goods purchased and best value from suppliers. By doing so and cutting unnecessary costs, the public sector will also be able to minimise redundancies and thereby protect and maintain public services in the south west.”

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