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back to article MPs say shared service sums 'don't add up'

MPs say that the Cabinet Office's claim that government could save £1.4bn a year through sharing corporate services is a "flimsy estimate at best". A key problem is the lack of centrally agreed benchmarks against which to measure the performance of shared functions, including the impact of two of the established shared service …

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  1. Stefan
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    Shared Services - An exercise in futility.

    Not only are the brainless dolts on the end of the shared service telephones inept, they don't care that they are inept. They are responsible for nothing, can help with nothing, can resolve no problems and even their most basic tasks (scan the invoice, confirm the invoice will be paid) are not guaranteed to be enacted in a correct or timely way.

    Most shared service employees could be replaced with a very small computer program.

    Them: "This invoice does not have purchase order number, we cannot process this invoice without a purchase order number".

    Us: "We have never issued a purchase order number on our invoices in the past and our client states that they do not use them".

    Them: "I am sorry, we need a purchase order number and this invoice does not have a purchase order number. You need to get a purchase order number because we cannot process this invoice without a purchase order number."

    Us: "You paid last month's invoice and that didn't have a purchase order number".

    Them: "I am sorry, we need a purchase order number and this invoice..."

    Us: "So who can supply a purchase order number?"

    Them: "I am sorry, I do not have that information. Is there anything else I can help with?".

    This happens daily.

    So what we have with this wonderful scheme is a *possible* reduction in costs for the NHS departments we were used to dealing with, but an increase in costs for *all* of their suppliers. Great scheme. Let's just transfer all the time, energy and money involved in competently administering an accounts payable department to the fools trying to supply goods and services to one of the most important sectors in the UK.

    That we have to *constantly* rule-bend and contact some very put-upon staff at each of the NHS trusts to get things done is hardly good for business. Staff turnover at some of the trusts has noticably increased.

    Not only this, but the trusts themselves recognise the poor service we are receiving. I have one very nice lady at an NHS trust I will not name referring to shared services as "those idiots in Bangalore".

    That I now read about the lack of cost savings really makes me quite mad.

    Grr. Arg.

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  2. Suzi
    Go

    Of course there are savings!

    The article didn't say there weren't savings being made. It said that the joint venture hadn't made a profit, which (unlikely as it seems) may just mean that the contract is a good one for the NHS. Trusts wouldn't use it at all if they weren't making savings, because using it is not mandated.

    Personally I'd have thought there are HUGE savings to be made in the NHS, and this should be the tip of the iceberg. Outsource the lot of the back office bureaucracy.

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  3. Bruce Leyden
    Unhappy

    The NHS is like a half-dead horse surrounded by hungry mosquitoes it can't do anything about

    Ooh it's like Vicorian times... "I know how to fix the NHS! It's horrible and inefficent and wasteful, so we need leeches! Leeches for everything! Miracle cure for ineffectual bloatedness - tenacious, bloodsucking, pond-dwelling invertebrates!"

    I sincerely hope Xansa shareholders lose badly out of this, but somehow I think everything will be done to make sure that doesn't happen.

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  4. Anonymous Coward
    Stop

    Devil in the details not provided

    1) The shared service centre was an idea from senior the Prison Service bods in Central London (who, themselves, are ex-Inland Revenue)

    2) They managed to implement Oracle Financials and a few other tools (like Documentum) and think they are the bees' knees

    3) Having such extreme belief in their superior capability (and having knoweldge of other government operations where things are worse), they decide to set up a shared service centre where they can pay low salaries (Newport) and - most importantly, build it to scale so they can take over the work of other government departments (i.e. Home Office) >> Even thought they don't have a mandate to do so <<

    4) Of course, they get promoted (it's no Terminal 5, it works) and they get more money for themselves while lowering the average staff salary because of the location - i.e. cost effective, not more process efficient. The Prison Service senior managers from London are technically relocated (of course, the majority of them don't move !) but it's amazing that they have frequent meetings in London to which they travel, of course, First Class.

    To be fair, comparing this with other Government projects, it's fantastic. However, the governance is so poor that taxpayers money can be spent like this without authorisation. All credit to the MPs who want to scrutinise the details but it seems all a little bit too late - how on earth did the NHS and Prison Service manage to proceed without a cast iron business case with measures in place to monitor achievements.

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  5. Anonymous Coward
    Anonymous Coward

    Shared services does work. Just not for the NHS.

    There's nothing wrong with shared services. Economies of scale works.

    The problem with the NHS though is that the NHS doesn't exist to make profit, it exists to provide for two groups of people.

    Group A think their health is a voting issue (women.) The NHS exists to make them think the government cares about Group A's health.

    Group B vote the government out if they're unemployed, despite being not very good at everything. The NHS exists here to employ them, without the people in Group A realising the government's wasting their money. (Not that it usually is Group A's whose money is being wasted, as the section of society that use the NHS the most, are the people who pay the least for it. i.e. women, old women and very old women - whose health costs account for perhaps 70% of NHS expenditure, and 90% of their research budget - viz said it best - my grandma lived to 90 year never did a day's work in her life, yet my grandad worked every day, and died the day before he retired. I wouldn't be in the least bit surprised if Merck's "manufacturing problems" with 10mg Simvastatin has occured because government's realised twenty years hence, we'll have a million men actually wanting some of the pension they've paid into.)

    Anyway, back to the topic, since shared services means saving money by reducing duplication and sacking the least good, but the NHS exists to employ them by causing duplication, it follows that for the NHS shared services must be defined to never work.

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  6. Leo Maxwell
    Paris Hilton

    So your grandma never did a days work

    So, I suppose that raising your mother or father, cleaning house and cooking for your grandfather and his children, having sex with him and probably looking after you when your parents couldn't cope with you anymore (as you are obviously a real PITA). don't count as "work".

    My grandmother raised 3 children after her husband died when the youngest was 2.

    She made it to 89.

    Paris because this is possibly the most totally puerile, sexist rubbish I have ever read.

    P.S. I am not female.

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  7. Leo Maxwell
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    A system devised to prevent corruption, which actively encourages it.

    Shared services means for our local NHS operations, that they no longer have the ability to choose the best and most cost effective solution, they have to use an "approved supplier".

    We quoted for a replacement to equipment which we had supplied 4 years earlier.

    The local management was told that because we were not an approved supplier, we were not able to tender.

    The person who makes decisions on office equipment for their area was a logistics manager.

    They duly received 2 pieces of equipment, both made by the OEM we represent.

    one was obviously reconditioned, and far too large for their office. The other was the same model we had quoted for.

    Our Quote was £200 per month lower than the incoming equipment, and was for new machines.

    3 months later the printing operation was closed as "not cost effective"

    The "approved supplier" was a large Office equipment company with a long history of sharp practice ( presently being sued by 2 local authorities).

    The shared resource initiative locks out local suppliers, disenfranchises local management, and encourages corruption.

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