VISA GOVERNMENT SERVICES-DELIVERING

EFFICIENCY SAVINGS ACROSS THE PUBLIC SECTOR

The Government Procurement Card (GPC Visa) programme was originally launched by HM Treasury with Visa Europe and a consortium of its issuing banks, following a competitive tender in 1997. The aim of the initiative was to reduce the costs of lower value procurement by streamlining the purchasing procedure, using the improved management information to monitor and evaluate purchasing activity and to increase efficiency across the purchase-to-pay process.

The initial targets set were challenging but were successfully achieved and, more importantly, ?77mn in process-efficiency savings were achieved.

By the end of 2002, GPC Visa had become established as a best-practice tool for lower value procurement and, following a fully EU compliant competitive tender process under OJEC rules, the Office of Government Commerce (OGC) awarded the second GPC contract to Visa Europe and an expanded consortium of issuing banks.

The 2003 programme
All public-sector organisations in the UK, including the central government, local government, NHS, education and the emergency services are now able to benefit fully from the new GPC contract. When the new GPC agreement was launched on 1 February 2003, managerial responsibility for the new scheme transferred to the Government Procurement Card team within OGCbuying.solutions.

In negotiating the new contract, OGC ensured that a number of
key benefits were built into the new contract:

.  An extended choice of bank issuers to ensure compliance with EU directives on procurement.
.  Travel and Subsistence (T&S) cards included under the same terms as the GPC Visa.
.  Improved options, e.g. the provision of enhanced management information.
.  Key performance standards by which all issuing banks are measured.
.  Five-year term with option to extend for a further two years.

Key successes
During the first full year of the new GPC contract, well in excess
of 100 new GPC Visa programmes were launched. In 2003 alone, almost as much spending was achieved in that one year than the total spend made throughout the entire five years of the original contract. During October 2004, total spend through the GPC Visa programme had exceeded £1bn.

The considerable process cost-savings available through the use
of GPC Visa continue to grow. To date, process cost-savings achieved through the use of GPC Visa exceed £170mn based on a £28 efficiency savings figure endorsed by the National Audit Office and derived by comparing a Procurement Card transaction to a traditional paper-based transaction.

Prior to the new contract, many wider public sector organisations had recognised the benefits of implementing a Visa Purchasing Card programme and their total spend through
the cards in 2003 totalled approximately a quarter of a billion pounds. Under the new contract, all of these organisations are now able to adopt GPC Visa.
Record GPC Visa process efficiency savings were achieved in 2003, totalling nearly £50mn, and the recent NAO Report on Improving Government (12 March 2004) identified GPC Visa as
one of the contributing factors to the £1.6bn value for money improvements achieved by the OGC.

The GPC Visa programme provides benefits to users and suppliers. Users benefit from a reduction in process costs, a reduction in time spent processing orders, empowerment with accountability, reduced paperwork (no requisition or PO), increased control, detailed management information, a complete audit trail and the potential to remove paper invoices.
Suppliers that accept GPC Visa can also benefit from reduced process costs, reduced credit control, payment within four working days, automated processes, back-office efficiencies, the
potential to remove invoices, new business opportunities and fewer invoice queries.

GPC Visa has become firmly established as the most efficient method for ordering and paying for lower value, high-volume purchases. High-level endorsement and support has come from
the OGC and key influencing bodies such as the NAO, HM Treasury, NHS PASA, the Society of Procurement Officers (SOPO) and the National e-Procurement Project (NePP).

The new benchmarking site (www.purchasingcard.info) endorsed by OGCbuying.solutions and sponsored by Visa, provides GPC Visa programme managers and their suppliers with a quick and easy way of evaluating the effectiveness of their programmes and identifying opportunities for improvement.

There are also opportunities to drive out further benefits from the GPC Visa programme. To this end a number of user groups,
roadshows and seminars are held regularly - with the objective
of sharing common issues and solutions and to encourage the development of common best practices.

With more than 1,000 GPC Visa and Visa Purchasing Public Sector programmes in the UK, there is considerable experience of this well proven and established solution. There are also many new opportunities to expand the programme, not least through the role GPC Visa plays as an integral part of the e-government agenda. With its proven track record and endorsements from many senior stakeholders across the UK public sector, GPC Visa continues to play a key role in the modernising government agenda and provides considerable savings and efficiencies to users and suppliers alike.

For further information go to www.purchasingcard.info
or email us at gpc@visa.com

Iain Currie, Head of Government Services, Visa Europe.