Government departments and other public bodies will be able to begin reclaiming overcharges and incorrect payments from suppliers under a new scheme launched by the Crown Commercial Service.
The Cabinet Office executive agency’s Spend Analysis and Recovery Services framework will be used to identify areas of spend where public bodies have been incorrectly charged or have overpaid a supplier – helping to recover money for departments.
Speaking to Civil Service World about the plans in November last year, CCS chief executive Malcolm Harrison said the scheme would create a mechanism to ensure that government “doesn’t get charged for something we shouldn’t be charged for”.
Such problems can occur when requirements change over the course of a contract, and the framework will formalise the process of how renegotiations and cost recovery are undertaken.
CCS has now announced that 19 suppliers will be on the framework to lead the work, including accountancy and audit specialists with expertise across areas like utilities, telecoms and VAT. CCS expects the framework to recover over £220m over the next four years. Providers will work across seven lots, covering the largest areas of government procurement spend from agency staff to property, on a “no-win-no-fee” basis to analyse up to six years financial transactions and commercial agreements for overpayments or errors.
The creation of the framework came after what Harrison called “a couple of instances where CCS helped departments recover fairly large sums of money”, and replicates a system of cost control often seen in the private sector.
“It is not so much about contract management, it is more about people who have got advanced analytical skills and are able to look at what it is you are being charged for and compare this with how your needs have evolved, and ensuring that those two match up,” Harrison said. “It is about analytical skills. Then there may well be some spend recovery work that needs to be done on the back of that [but] you’re only going to do that, and get that agreed with a supplier, if you have very good documentary evidence of how that mismatch has occurred.”
Matthew Sparkes, CCS’s deputy director for financial services, added that the framework would not only recover valuable funds, but also help CCS and public bodies understand where to make improvements in procurement to ensure errors won’t happen again.
“By combining our own CCS category expertise with our suppliers’ commercial expertise we can ensure that the public sector pays only for the goods and services it actually receives,” he said.
The full list of lots is:
Lot 1: Statement Transaction Review
Lot 2: End-to-End Review
Lot 3: Contract Compliance — utilities
Lot 4: Contract Compliance — telecoms / mobiles
Lot 5: Contract Compliance — contingent labour / agency staff
Lot 6: Contract Compliance — VAT
Lot 7: Contract Compliance — property / rental review