Deal "could save colleges £100 million a year"
Deal "could save colleges £100 million a year"
A contract signed between the Association of Colleges (AoC) and E-Government Solutions UK (eGS) is expected to help UK colleges to save up to £100 million a year. The partnership will create FEOnline, an Internet portal supporting an electronic procurement system and online resources for the further education sector's 440 colleges. The deal puts colleges on track to meet the Government's 2005 e-government targets. Colleges will be able to source everything from stationery and information-technology equipment to minibuses through FEOnline. eGS forecasts that most of the £1 billion currently spent by colleges each year will flow in time through the FEOnline marketplace.
An eGS spokesman commented: "It is widely acknowledged that electronic purchasing can reduce the cost of order processing from an average of £75 per transaction to as little as £10. Volume buying can also cut the price of products by 8 per cent." Overall, the savings brought by FEOnline could add up to £100 million a year. FEOnline will drive down the time and administration cost incurred through traditional procurement methods. Currently,college purchasing of computers typically entails as many as 21 administrative stages, involving up to 12 people and five sets of documents. Using an e-purchasing system originally developed for US space agency Nasa, FEOnline will help colleges to cut order-processing complexity, shortening the purchasing cycle by up to 90 per cent. AoC chief executive David Gibson said: "This is a major opportunity for all member colleges to benefit from real savings in purchasing at a time when the low level of funding in colleges is reaching crisis point."
