Finance: Hempsons Solicitors

We have been advising Greater Manchester and other groups of acute and primary care trusts as they trial new collaborative procurement arrangements. Our experience is that with fundamental frameworks in place and well-managed communications between all partners, you can realise tangible benefits and demonstrate marked savings and value for money.

Key elements for any collaborative procurement agreement must include thorough research to establish demand for a service, and good communication. Keeping stakeholders informed of
the targets you are all jointly achieving helps to achieve buy-in.

Successful procurement requires professionals, so appoint them. You need people with procurement knowledge as well as managers with expertise in key commodity areas.

Financial control is also key. Costing should cover the whole life of the contract, identifying immediate and longer-term savings. Agree clear expenditure thresholds with suppliers where bulk purchase discounts kick in and ensure that all providers understand the savings they will enjoy by joining forces to reach those thresholds.

If you get the frameworks right, strong partnerships can be formed with suppliers through commitment to contracts and a focused route into the health economy. Suppliers should benefit from a clearer system, with fewer fragmented orders.

Some commentators continue to advocate the creation of independent collaborative procurement bodies to take the onus from healthcare providers and allow the freedom to create new and innovative purchasing agreements.

Currently, the responsibility to secure value for money on supplies and services remains firmly with healthcare managers. And as national roll-out of collaborative procurement to 11 hubs based around new strategic health authority boundaries appears imminent, it is an issue that is set to move very quickly to the top of their agenda.

Charles Hugh-Jones is a partner at Hempsons Solicitors.