SALISBURY NHS FOUNDATION TRUST TITLE: PROCUREMENT PROGRESS REPORT - NOVEMBER 2006 TO FEBRUARY 2007

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1 SALISBURY NHS FOUNDATION TRUST PAPER NUMBER: SHC 1737 TITLE: PROCUREMENT PROGRESS REPORT - NOVEMBER 2006 TO FEBRUARY 2007 PURPOSE OF PAPER: To inform the Trust Board about procurement performance for the period 1 st November 2006 to 28 th February EXECUTIVE SUMMARY: 1. Cost savings achieved year to date total 708k of which 489k are effective this financial year. 2. All supply issues have been resolved satisfactorily to avoid patient cancellation. The Department continues to receive positive feedback from across the Trust. 3. It has been a very busy period with a noticeable increase in tendering activity, particularly through the European Journal. 4. Team members are actively engaged in providing commercial advice in a range of cross functional projects. 5. An Opportunity Assessment is underway for a proposed South West Procurement Hub. The Trust will need to decide in due course whether it wishes to participate in the arrangements when finalised. ACTION REQUIRED BY THE BOARD: The Board is asked to note the report. Malcolm Cassells Director of Finance & Procurement 22nd March 2007

2 PROCUREMENT REPORT FOR THE PERIOD 1 ST NOVEMBER 2006 TO 28 TH FEBRUARY COST SAVINGS Cost savings achieved year to date is 708k of which 489k are effective this financial year. This is broken down as follows: Cash releasing savings total 117k Cost avoidance total 161k Savings against capital budgets total 210k 2.0 CONTRACTS Key areas of contracting activity over the four months were OJEU Tenders Intra-Ocular Lenses Flexible Endoscopes Orthotic Footwear External Auditors Wireless Network Radiology Phases 2 and 3 Home Herceptin Delivery Laparoscopy Equipment Blood Analyser Anaesthetic Machines Enteral Feeds National Contract Implementation Contracts are in place for the provision of agency workers across all professions in the Trust. Details are published on the Intranet. Demand levels for Agency Nurses are such that the nationally approved agencies are unable to meet requirements and separate agreements have been made at a premium with a local provider. Work needs to be progressed to avoid the use of agency staff. AGW Confederation Contracting Activity Collaborative working with the Confederation has resulted in an annualised saving of 19k in contrast media. Collaborative contracting for instrumentation repair is currently being led by Bristol. Orthopaedics: Results from findings by an external consultant regarding potential health community savings are currently being evaluated. Estates: Opportunities for savings from collaborative service contracts are being facilitated by external consultants. Local Contracting tenders Car Park Barriers and CCTV Scrubs Compression Garments Maternity beds, single use instruments Car Hire IT Integration Engine

3 Recycling Balers Ophthalmic Packs Over 100 maintenance agreements 3.0 NHS SW COLLABORATIVE PROCUREMENT HUBS An Opportunity Assessment project is underway to determine the most effective arrangements for purchasing to be undertaken within the South West. Board commitment and sign off to the outcomes will be sought in July 2007, ready for mobilisation in October and go-live April Once the proposals are known the Board will be able to decide whether as a Foundation Trust it wishes to participate in the new arrangements. 4.0 SINGLE TENDER ACTIONS For the eleven months of the year to end February, there were 103 single tender action forms with a value of 635k a reduction in value against this time last year. The main reasons identified for lack of competition was due to sole supply and compatibility with existing products. However some resulted from lack of planning by services and these will be raised at future 3:3 meetings with the Directorates. 5.0 SERVICE LEVELS 5.1 NHS Supply Chain: Support from NHS Supply Chain, our largest supplier continues to improve. 5.2 Receipt & Distribution: Discussions are in progress with Facilities and NHS Supply Chain to identify options for out of hours deliveries from Supply Chain to an intermediary delivery point on the hospital corridor network. The aim is to reduce the impact of the additional distance being travelled by the team following the opening of phase 2 and due to the location of the Procurement goods inwards store. This will also allow deliveries to be made under cover. 5.3 Materials Management: This service has now been extended to maternity 6.0 ELECTRONIC TRADING/REPORTING 6.1 Oracle Performance: The system is proving to be much more stable, with an average of 7 logs raised per month. 6.2 Oracle Procurement Development: Ability to order using bar code technology for materials management has been slower than expected 6.3 The reports generated within Oracle now provide useful data for contract management and identification of saving/process opportunities 6.4 National E-enablement: Contribution has continued to be made into the national strategy for e-enablement for procurement systems to facilitate sharing and benchmarking of information. 7.0 TRUST WIDE PROJECT GROUPS The following project groups involve staff from Procurement: Transport Strategy MDMC Technology Working Groups Patient Information Group Advertising and Sponsorship Committee Environmental Review Group

4 8.0 PROCUREMENT STAFF Three members of the team have been successful in their studies of NVQ3 Procurement and Supply studies. Other team members have benefited from PASA funded courses and undertaken mandatory manual handling/coshh/fork lift courses as appropriate. 9.0 GENERAL Procurement KPI s can be found attached Appendix A Commercial support and joint working with Facilities with regard to Laundry, Environment, Waste and Security A joint initiative with ETS is underway to review their stock holding arrangements Business planning for is underway. Opportunities for savings for next year will need to be focussed much more on contract management and supply chain savings, since much of our non-pay spend is already committed under formal contract. Elizabeth Liversage Head of Procurement

5 Appendix A KPI's for the Board 14th March 2007 COST SAVINGS 06/07 250, , , Value 150, , , , A - Cash Releasing B - Cost avoidance/minimisation C - Savings against capital/revenue budget 50, , , , , , , , , (Q1) APR-JUN (Q2) JUL-SEP (Q3) OCT-DEC (Q4) JAN-MAR Packages Delivered Quantity / / / / Single Tender Action Forms Raised 06/ , ,650 Volume Quantity , ,666 Sole Supplier Compatibility Urgent Other 0 (Q1) APR- JUN (Q2) JUL- SEP (Q3) OCT- DEC (Q4) JAN- MAR