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Click Travel was appointed in all three lots, and Capita Travel and Events in the third category. Their four-year contracts will run until November 2017.
Public and private travel management needs can vary greatly, says Betty Low, but the two sectors can learn a lot from one another
LATER THIS MONTH (JANUARY) the Government Procurement Service (GPS) will begin sharing the details of the next central government travel management services framework tender. Government purchasing is done
through a series of framework contracts for different categories. These are created via European Union-compliant bids which identify suppliers that departments and agencies can use without having to repeat the costly tender process themselves. The existing travel framework was divided into two lots. In the autumn of 2011 the GPS awarded Lot 1, which was for government departments with large international requirements, plus UK travel and accommodation, to HRG. Lot 2, which was for departments with mostly UK travel and accommodation, was awarded to Redfern Travel. No one was surprised by the
award to HRG. The global travel management company (TMC) was already the agent of record for both the Foreign Office and Ministry of Defence (MOD). The appointment of Redfern, however, raised a few eyebrows. A hitherto relatively unknown Yorkshire agency was awarded a contract set to double, even triple its annual turnover. The principle of risk management had collided with the government’s commitment to award public contracts to small- to medium- sized enterprises (SMEs).
CREATING EFFICIENCY The aim of both the three-year contracts was straightforward enough. Top Shop boss Philip Green had produced a report in 2010 which
recommended government consolidate suppliers to drive cost savings. In what had traditionally been a devolved, non- mandatory culture, the decision was made to mandate the use of TMCs for all government to reduce transaction fees, create process efficiencies and begin to deliver the consolidated data which for so long has been lacking in the public sector.
THE BIGGER PICTURE But that is central government’s travel management story, and it is important to remember that there is more to the UK public sector. Public sector organisations are those that either get a predominant proportion of their revenue from the state, or are regulated by government in how they do receive income (think BBC licence fee or university tuition fees). The organisations vary – from small agencies in the Outer Hebrides to local government departments with large travel budgets – but they do have some common characteristics, such as political and social considerations, the need for higher visibility, sustainability reporting and low ceilings on hotel rates. These can lead to some common challenges. The recent tender for travel services for this wider public sector was not split into lots on the basis of travel profile, as per central government, but on the basis of the service offered. The three lots of the framework were: online hotel and rail; online for hotel, rail and air, plus offline help, support and booking; and the services in the first two lots, plus the ability to call upon a full travel management service.
DIVERSE NEEDS
Central government departments and agencies may have different travel requirements, but those become even more varied when you introduce the wider public sector into the mix. Capita Travel and Events’ acquisitions of Lonsdale, BSI and Expotel means it has a longstanding legacy of public sector clients. “Our clients are different – the Met Office will have a different requirement from the NHS in the Orkneys,” says Capita director Steve Banks. He believes the gap between how the public and private sectors purchase travel has narrowed. “In recent years there has been a lot more attention to compliance and maximising cost-savings opportunities, and a lot more making sure that policy is fit for purpose,” he says.
Another sign of modernisation, according to Banks, is a move to looking at total trip costs. “There are hidden costs such as travel to the station or the airport [which need to be taken into account so] we can compare total costs and total time,” he says. “We recognise that in the public sector there is a lot of visibility of what and how they’re spending.” Banks sees the adoption of online booking as important to cost savings. “There is still a good opportunity to increase online adoption,” he says. “A lot of people in the public sector still like that personal touch and interaction.”
ONLINE ADVANTAGES Online booking has advantages that those charged with university travel management also recognise. Andy Speller is managing director of Key Travel, which has 70 university clients and is the top-ranked supplier on the SUPC (Southern Universities Purchasing Consortium) framework and the largest supplier on the
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