At the beginning of the 2004/05 academic year, Executive Board and Council approved the University's value for money strategy. Our strategy is based on revised guidance issued by the HEFCE on securing value for money arrangements. The objectives of our value for money strategy are:
This report sets out briefly some of the activities undertaken during 2004/05.
It is important to note that we agreed, as part of our strategy, that value for money should be integrated into our existing management, planning and review processes. The following, therefore, represents an example of projects where value for money has feature heavily but it does not claim to be exclusive and it does not suggest that value for money does not form part of our ongoing management activity.
This was the major value for money project undertaken by Internal Audit. Internal Audit are aiming to submit the final report to Audit Committee in September 2005. We spent around £430,000 on agency staff in 2004/05. Following a competitive process, Office Angels were awarded the contract to supply temporary agency staff following a presentation outlining how they would meet the criteria in terms of competitive rates, quality of service and staff supplied, benefits to employees and number and range of temps available.
A review of the University's expenditure on bank charges was carried out by Fin Analysis UK Ltd at a cost of just under £16,000. This identified savings in the mechanisms used for foreign drafts and transfers, credit card charges and Barclay's direct data. These savings have been identified as £10,500 a year and have been implemented. We have also adopted a new currency conversion procedure which allows acceptance of credit cards from overseas students at an exchange rate which is quoted to them at the time of payment. This reduces the card charge by 0.8% on payment and the estimated saving here, depending on take up, is in the region of £15,000 a year.
This has already been reported to Executive Board. The University worked with Russell Partnership to analyse the provision of catering on campus and the Director of Accommodation and Hospitality Services recommended that catering be brought back in house. This policy was implemented in full for the first time during 2004/05. During the first full year of operation, customer feedback has improved, a significantly greater spend is remaining within the University and the reputation for good quality, customer focus and value for money is building. The next stage will be the reopening of a University run facility in the King's Road Centre.
A framework agreement was awarded for the hire of coaches with drivers for use by staff and students. The contract was awarded to 6 companies who offer competitive pricing, good quality coaches and a range of coaches of various sizes to meet the University's requirements.
The Library has pursued a policy of investing in e-journals as a way of making far more information available to our research and teaching community. The costs of our access to e-journals has been reduced by approximately one third for each download over the last three financial years. So in 2002/03, the cost of download from any journal made available by Elsevier was £2.30, in 2004/05 this has been reduced to £1.66. This is an important example of value for money because it demonstrates that value for money is not just about driving down costs. In cash terms, the amount we have had to spend on e-journals has increased significantly. In the case of Elsevier it has risen from £164,000 in 2002/03 to £370,000 in 2004/05 but the number of journals made available to our users has increased by almost 90% and far more articles are being used by our academic community.
The Faculty of Medical Sciences has reviewed its policy on e-journals and has decided to increase its subscriptions and prevent individuals from reclaiming personal subscriptions to the same journals.
This forms a major part of the work of the Estates Office to improve efficiency and sustainability. A recent paper on energy management was submitted to Executive Board. New lighting to the outside of the Armstrong Building will reduce by two thirds the current electrical usage of lighting (saving approximately £700 a year).
Use of cross flow ventilation systems instead of air conditioning is being instigated in the large computer cluster in the Stephenson Building and forms part of the plans for the Barras Building.
Ongoing energy surveys in various buildings identified an inefficient water-based cooling system in the Herschel Building which had been shut down saving £10,000 a year.
Value engineering workshops are now routinely undertaken as part of the procurement process on any large project.
This has been the subject of some debate and some ongoing operational issues. It has been decided to invite the Chairman of Audit Committee to attend a future meeting of Executive Board. In the interim, the Registrar is getting together a group to look at the issue of University expenses from the perspective of value for money.
A competitive tender was undertaken and after shortlisting and presentations by suppliers PriceWaterhouseCoopers were awarded the contract in July 2005 to conduct external audits within the University.
PriceWaterhouseCoopers were judged to offer overall best value to the University on a range of issues including fees charged, experience of the HE sector, experience and quality of their auditing team, range and benefits of added services, quality assurance, management of ethical standards, and their ability to support the University from Newcastle.
The framework agreement for Estates consultants has been re-established but a mini competition arrangement has been instigated for any work let to the consultants on the framework in an effort to drive down fees.
Our procurement of legal services was reviewed during the year and the outcome of this review was reported to Executive Board. We have taken the decision to renew our contractual arrangements with Eversheds. We believe the rates secured represent good value for money and we have strengthened our working relationship with Eversheds.
The arrangements for portering have been reviewed and new arrangements will be implemented as part of the Estates restructuring project.
Our printing provision has been reviewed resulting in a consolidation of internal University printing capability in the Library.
The University has purchased the services of Sanderson Weatherall to act as specialist advisers on rates, appeals and calculations. It is intended to benefit from a range of temporary and permanent savings that have not now been applied for as well as gaining specialist rating advice. Sanderson Weatherall will operate on the basis of a percentage for any saving secured.
The Library has undertaken a Six Sigma project in partnership with 3M which increased the percentage of self issues in the Library from 36% to an average of 64% during term time. This was achieved with no additional capital investment, the project using other means to produce the increase in use. This in turn has allowed the Library to reduce the number of staff on the Reception desk.
Our mechanisms for securing incoming and outgoing line rentals are reviewed regularly and we have been able to save approximately £50,000 against the initial estimates for 2004/05.
A competitive tender was undertaken during 2004/05 and, after shortlisting and presentations by suppliers Fleet Street Travel, Dawson & Sanderson and the Travel Bureau were awarded the contract to provide travel agency services to the University.
Dawson & Sanderson and The Travel Bureau both offer 1% discount on rail; therefore saving money and deliver tickets direct to the University. Fleet Street and Dawson and Sanderson offer an on-line searching and booking tool allowing users to select the lowest price airfares.
An EU tender exercise was conducted to appoint a contractor to oversee the waste collection of all University sites under a universal contract. Previously all units had their own contract with various contractors. The contract is campus wide and a competitive rate was obtained for bin lifts and rental, compactor lifts and skip hires. The University has a more manageable contract with Sita than with the previous supplier with favourable rates and a reliable service and a saving of £25,000 a year against the previous contractor's price.
As part of our strategy, Executive Board has been identified as the University-wide committee with executive responsibility for consideration of value for money issues. Executive Board will review performance indicators on key elements of the University's activity to contribute to its assessment of the University's economy, efficiency and effectiveness. Following the initial recommendations made by the working group on Governance, we will also take steps to strengthen our use of key performance indicators. This will form an important part of the role of the Director of Planning, Stephen Frater, and responsibility for value for money projects was built into the job description of the Director of Planning.
6 September 2005