Council spending
Discussion
Your thoughts on this:
Local Authority needs to buy an item. 2 suppliers have the correct item.
Supplier A is offering it for £70
Supplier B is offering it for £60
Supplier A is within the LA boundary area. They are £10 more expensive but is it worth spending the extra to keep the money within the LA area and help (in this case) a medium sized business in its own locality.
Supplier B is outside the LA area but is obviously cheaper.
Which should they use?
If you say Supplier A where is the line drawn in terms of extra expense? £20 £50 £100 £1000 ??????
Local Authority needs to buy an item. 2 suppliers have the correct item.
Supplier A is offering it for £70
Supplier B is offering it for £60
Supplier A is within the LA boundary area. They are £10 more expensive but is it worth spending the extra to keep the money within the LA area and help (in this case) a medium sized business in its own locality.
Supplier B is outside the LA area but is obviously cheaper.
Which should they use?
If you say Supplier A where is the line drawn in terms of extra expense? £20 £50 £100 £1000 ??????
Oakey said:
If B are selling for cheaper and stll able to turn a profit then maybe A is overpriced?
Perhaps B are a bigger company?The point is, Councils are very much encouraged to promote growth in their area etc - and they do indeed spend a lot of raw money on 'initiatives'.
I wondered whether they chould/should just spend raw money on supporting businesses directly when they could - but obviously not at any cost - i.e if a business is obviously far more expensive than a competitor.
My experience is that there is no weighting for locality in council procurement. For larger tenders they are actively encouraged to seek applicants from all of Europe.
As someone mentioned it is unfortunate but there is often someone getting a kickback of sorts somewhere along the line.
As someone mentioned it is unfortunate but there is often someone getting a kickback of sorts somewhere along the line.
Mojooo said:
Oakey said:
If B are selling for cheaper and stll able to turn a profit then maybe A is overpriced?
Perhaps B are a bigger company?The point is, Councils are very much encouraged to promote growth in their area etc - and they do indeed spend a lot of raw money on 'initiatives'.
I wondered whether they chould/should just spend raw money on supporting businesses directly when they could - but obviously not at any cost - i.e if a business is obviously far more expensive than a competitor.
Supporting the UK despite it not being what the customer actually wants.
Du1point8 said:
You sound like you would have voted bombardier for the trains, even though they can't cope with the UK order and the non UK company that got the contact have a reputation for developing better trains and keep to deadlines with deliverables and cost.
Supporting the UK despite it not being what the customer actually wants.
Well I couldn;t say for sure as I don't know the ins and outs but on the sounds of it is a different question altogether.Supporting the UK despite it not being what the customer actually wants.
Clearly if you are tendering for multi thousand pound contracts you go for value/quality but when we are talking small sums for exactly the same product then there might be some value in keeping spending within a local area.
I suppose the bottom line is that it is hard to quantify any benefit to the local business/area whereas its very easy to quantify the spending differences.
Mojooo said:
Du1point8 said:
You sound like you would have voted bombardier for the trains, even though they can't cope with the UK order and the non UK company that got the contact have a reputation for developing better trains and keep to deadlines with deliverables and cost.
Supporting the UK despite it not being what the customer actually wants.
Well I couldn;t say for sure as I don't know the ins and outs but on the sounds of it is a different question altogether.Supporting the UK despite it not being what the customer actually wants.
Clearly if you are tendering for multi thousand pound contracts you go for value/quality but when we are talking small sums for exactly the same product then there might be some value in keeping spending within a local area.
I suppose the bottom line is that it is hard to quantify any benefit to the local business/area whereas its very easy to quantify the spending differences.
If it was a bigger thing then questions can be asked, but over £10.... no
you forgot to mention that the council department in question only "needs" to buy the item as they have a large ammount of money left in their budget for that tax year and as the tax year is coming to a close they want to get rid of the funds to guarantee they wont have their spending budget cut for the following year...
as an example fo such disgraceful waste of public money -
My company was called in to look at replacing the "tea/coffee station" at a local council office.
I arrived to measure up to find a reasonably new set of cupboards,sink,tap and worksurface (indeed I was told they were only 2 years old!). Bear in mind this was only for people from within the office to make cups of tea or coffee at. When I asked why they wanted a solid GRANITE top with undermounted sink and new units I was told it was because they had several thousand pounds left of that years budget and they needed to spend it quickly before the end of the budget year or face having their future budget cut!
I also know another department that bought new laptops for everyone then 6 months later bought all new laptops again due to it being within the following budget year...
I guarantee more money is wasted by local authorities in this manner than any of use dare consider...
as an example fo such disgraceful waste of public money -
My company was called in to look at replacing the "tea/coffee station" at a local council office.
I arrived to measure up to find a reasonably new set of cupboards,sink,tap and worksurface (indeed I was told they were only 2 years old!). Bear in mind this was only for people from within the office to make cups of tea or coffee at. When I asked why they wanted a solid GRANITE top with undermounted sink and new units I was told it was because they had several thousand pounds left of that years budget and they needed to spend it quickly before the end of the budget year or face having their future budget cut!
I also know another department that bought new laptops for everyone then 6 months later bought all new laptops again due to it being within the following budget year...
I guarantee more money is wasted by local authorities in this manner than any of use dare consider...
The correct 'technical' answer is that the council should choose the option that offers the greatest value to the council. In reality, this means, whatever is cheapest.
Inward Investment is a lovely notion spouted by politicians and council members but the officers responsible for procurement often have no power to deliver this in reality.
In 1999, Essex County Council appointed a Facilities Management company to handle the procurement of a wide range of services including printing. Up until this point, the council had placed almost all its quite hefty print orders within the county and many local business had thrived on this. Within two years of the FM company taking over, almost all of the printing was done either in Yorkshire or Poland with printers that the FM company either owned or had a stake in resulting in at least four sizeable printing companies folding, one a family run firm that had been in business for over 100 years.
But, hey, at least the council was getting good value!
Inward Investment is a lovely notion spouted by politicians and council members but the officers responsible for procurement often have no power to deliver this in reality.
In 1999, Essex County Council appointed a Facilities Management company to handle the procurement of a wide range of services including printing. Up until this point, the council had placed almost all its quite hefty print orders within the county and many local business had thrived on this. Within two years of the FM company taking over, almost all of the printing was done either in Yorkshire or Poland with printers that the FM company either owned or had a stake in resulting in at least four sizeable printing companies folding, one a family run firm that had been in business for over 100 years.
But, hey, at least the council was getting good value!
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