Payroll, HR Administration and Transactional Recruitment Services framework puts two trusts on road to £2m savings

In response to Department of Health and CIPFA reports into the savings potential of improving back office efficiency, NHS London Procurement Partnership (LPP) has created a flexible framework which enables NHS trusts to realise those benefits – and two trusts are already on the road to saving £2m.

In November 2010 the Department of Health report back office efficiency and management optimisation concluded that at least £600m of the £2.8bn annual spend can be saved across the NHS in England through more efficient ways of providing corporate services. HR benchmarking work undertaken by CIPFA for NHS London in April 2011 confirmed this, identifying productivity opportunities in areas of non-clinical support back office functions.

LPP’s Professional Services Senior Category Manager Lena Boghossian worked with two LPP member trusts West London Mental Health NHS Trust (WLMHT) and Camden and Islington NHS Foundation Trust (C&I) to build the framework, and the new agreement went live in November 2012. It will run until 2016. WLMHT had identified a need to outsource non-core services. The key success factor for WLMHT was the need to deliver sustainable savings whilst maintaining and improving service quality. The successful service provider is saving the trust approximately £300,000 a year.

A benchmark review by C&I in 2012 of their payroll service provider demonstrated that the trust’s existing payroll contract was not providing value for money. C&I employ approximately 1,500 staff. Lena managed a mini competition for C&I, and the outcome is a quality payroll service which is also making savings for the trust of approximately £130,000a year.

As Lena explains, “This three lot framework provides NHS organisations across the country with a pre-approved list of suppliers for a number of transactional back office functions. Organisations can select suppliers from one, two or all three lots, and each contract award is underpinned by competition between framework providers to ensure the best possible solution.  Those mini competitions can be run by organisations themselves or, where capacity or capability is an issue, LPP can provide that service.”

The three lots are:

• Lot 1 Payroll Services, including core payroll and expenses administration plus reporting and submitting data for financial reconciliation and accounting.
• Lot 2 HR Administration, covering the work required to maintain and update HR records and information using the Electronic Staff Record. This includes personal and contractual information plus learning and training records.
• Lot 3 Transactional Recruitment covers the work required to place and administer vacancy advertisements, schedule interviews, manage the offer process, and obtain pre-employment checks required by NHS organisations.

 

Linda Dyson, Deputy Director of Organisational Development and Workforce at West London Mental Health NHS Trustsaid, “The use of this flexible framework has supported the trust in reducing costs and should deliver service improvements for the future. It provides a base from which other NHS trusts can improve their own back office services and costs, and in a short timescale, as LPP has already gone through the legal hoops of approving suppliers.”

David Wragg, Director of Finance at Camden and Islington NHS Foundation Trust added, “Being able to access the procurement expertise of LPP and work in collaboration with member trusts provides us with much greater leverage than we can achieve in isolation. We look forward to other trusts benefiting from this valuable framework.”