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. We are responsible for validating and reporting all savings for common goods and services procurement.
- All benefits are, wherever possible, calculated against a pan government 2009/10 baseline.
- The baseline represents actual prices paid by central government for the same product/service during the baseline period.
- Transactions from 1 April 2010 are 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 are subject to an approved initiative methodology, supported by a formal sign-off route.
- All savings must be evidenced by supplier provided transactional Management Information.