A pilot scheme to help housing associations pool their buying power and make huge savings was launched this week, following a successful bid for funding from the Housing Corporation
It is hoped the move could help save on repairs and improvement costs, without any increase in public funding.

A consortium made up of Chartered Institute of Housing subsidiary HouseMark, the National Housing Federation and training organisation HATS will market-test the potential for a national RSL purchasing body.

Previous research suggested that the greatest areas of expenditure for associations, in terms of consortium purchasing, included electricity, telecommunications, office and general supplies and insurance.

Twenty RSLs will be consulted for the pilot, initially to identify buying arrangements by product area. Follow-up research will involve interviews with key decision makers in up to 75 RSLs.

Preliminary studies identified a variation between RSLs’ purchasing behaviour and their understanding of how they buy.

HouseMark chief executive Ross Fraser said the initiative would mean substantial short-term cost savings, and a stable improvement in associations’ cost base in the medium term.

Jane Greenoak, director of corporate services at the federation, said: “There is clearly a business need for RSLs to improve and streamline procurement processes.

“At the moment they have adequate information on what they spend, but a purchasing consortium would be able to provide detailed statistics to each participant on what they buy.”

According to the consortium, associations spend on average £218m annually on goods and services, much of which could be bought jointly.

The pilot could have the potential to harness the buying power of 1.45m households in social housing. This would “improve the economic position of those consumers, contributing to a reduction in poverty without any additional recourse to public funds,” the consortium said.

Source

Housing Today