OGC says its e-auction strategy will save £270m by 2011/12

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The Office of Government Commerce's Centre for e-Auctions has today published its Forward Plan for e-Auctions.  The OGC hopes the e-auctions will save the public sector up to £270m by the end of 2011/12.

The Forward Plan sets out the e-auctions for the next two years which, says the OGC, will influence over £900m of public sector spend.
E-auctions are used during the negotiation stage of a normal procurement. They are held on-line after an evaluation of supplier bids. Pre-qualified suppliers are linked into an e-auction portal and offer progressively lower bids in order to win the contract.

Bidding may last a few minutes or a few hours, and the e-auction results in a winning bidder with whom the contract is placed.

Although e-auctions are evidence that government looks for the lowest-priced bid, they are useful for buying commodity items, such as IT hardware and software packages. 

The OGC is also in the process of establishing, with the help of PA Consulting, an online facility dedicated to e-auctions, which will include on-line forums and access to best practice guidance. The site will be continually developed and enhanced based on user feedback and requirement, and will include regular updates on upcoming e-auctions.

These are the auctions planned for 2010/11, according to the forward plan:
 
ogc e auctions v hi res.jpg
Economic Secretary to the Treasury, Ian Pearson said:

"With the publication of this Forward Plan, I am calling on all public sector procurers to use developing technology in the collaborative procurement arena and to make full use of forthcoming e-auctions.

"As we continue to build the economic recovery, it is vital that we can take every opportunity for reducing costs to the public purse.  E-auctions deliver real, cash savings and should be used much more frequently."

The OGC says its Plan builds on its previous e-auction successes where savings are "frequently in excess of 10% and have been reliably measured at up to 50% against pre-auction prices".

The IT e-auctions began in 2005, with 11 completed to date. About 600 public sector organisations have participated. 

A Centre for e-Auctions was set up in late 2009 after a recommendation in HM Treasury's Operational Efficiency Programme (OEP) report. Its remit is to provide central co-ordination and support for e-auctions across the wider public sector.

In March there are four e-auctions either scheduled or already completed for temporary staff, carbon off-setting certificates, mobile phones and IT hardware.

The IT hardware e-auction scheduled for 25th March is the first one to use a Pro5 framework and involves participants from local government and wider public sector organisations.

The Centre for e-Auctions works with the OGC's Buying Solutions e-commerce team. The carbon off-setting and the mobile phones e-auctions are being run using Buying Solutions frameworks.

The Forward Plan for e-auctions - OGC website

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