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Her Majesty'€™s spend management


05-Jul-11 09:49

On the face of it, 5% savings over 12 months isn’t bad, but try telling that to anyone whose money goes towards the British Queen’s £32.1m annual upkeep. HRH may be cutting costs, but perhaps what we need here is spend management.

 

The keeper of the privy purse, Sir Alan Reid is tasked with managing what is essentially an open book of finances and there’s often an interesting dynamic, especially during times of public financial strife, as the luxury surrounding the royalty starts to grate somewhat with cash-strapped public.

 

Of course, you’re probably more likely to be politically motivated than financially incensed if you’re objecting to the 60-odd pence that, as a UK tax payer, you might contribute annually to HRH’s upkeep. Plus, there’s the idea that most of the Queen’s spend goes back into the economy via the people she employs.

But, put that aside, think of Royal Public Finances as a challenge. You can download and look at where the Queen spends her money (though the idea of her actually doling out fistfuls of £20 notes is worth the annual fee alone, I think) – and you can see where savings have been made. More than that, you can see where they’ve been consistently made over the recent years.

 

So consider what a smart purchasing brain could do in an institution like this. When you look at some of the areas where money has been saved – for example by deferring repairs – the ultimate effect might be battered, warped homes and palaces that in years to tourists would eye up and down and then trudge past and spend their money in gift shops, tea rooms and entrance fees elsewhere.

 

There may have been some gains made, if you look closely, in using low-energy lighting to cut electricity usage by some 12.6%.

 

Take an area like travel management however, and maybe there is a better opportunity for saving. Flying a royal entourage over to Canada, for example, isn’t cheap, but it’s not exactly the sort visit you can replace with video conferencing. Still, the amount of helicopter-flying that goes on can surely be curtailed? And when it costs the Queen and the Duke of Edinburgh £17,248 for a trip from London to Crewe (in the North West of England) you have to start looking at whether they aren’t being taken for a ride, so to speak.

 

Equally, think about the purchasing power – becoming customer-of-choice gets a lot easier when your supplier gets to put ‘by royal appointment’ on their stationary. You’d have plenty of negotiating power?

 

I think there’s an opportunity here for money to be better spent. I’m not saying explaining value to a constitutional monarch of 16 sovereign states is easy, but surely someone has some ideas on how they might get those costs down?

 

 

 

 

 

 

 

 

 


Steve Hall Steve Hall is Editor at Procurement Leaders. Steve oversees the publication of Procurement Leaders Magazine and draws on a decade in business publishing, providing quality coverage to senior business leaders. Follow Steve on Twitter: @thestephenhall

 
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