Savings are measured in accordance with guidance provided by the Efficiency and Reform Group guide “Measuring Up”, which was published on 29 November 2010.
The guidance aims to introduce a unified approach to driving savings, and is based on a number of principles. Government Procurement Service is responsible for validating and reporting all savings for common goods and services procurement.
- All benefits will, wherever possible, be calculated against a pan government 2009/10 baseline.
- The baseline will represent actual prices paid by Central Government for the same product / service during the baseline period.
- Transactions from 1 April 2010 will be eligible to generate savings.
- Benefits must release cash and be net of any implementation costs (including significant whole life costs where relevant)
- One off savings can be included where they do not represent deferred expenditure.
- Approved counterfactuals (inflation percentages) can be used where they are appropriate and approved by the savings team.
- Benefits are summarised in the following classifications:
- New Commercial Arrangements
- New Volumes
- Demand Management
- All savings will be subject to an approved initiative methodology, supported by a formal sign off route.
- All savings must be evidenced by supplier provided transactional Management Information.