The specialist body set up to support procurement by fire and rescue services is said to have suffered from insufficient leadership and oversight by the Communities Department.
In an assessment of the Firebuy scheme, the National Audit Office (NAO) report says it is expensive to run, with overheads between 5-10% higher than the industry norm.
The report says: “The department has not shown enough leadership, direction or oversight of Firebuy to ensure it achieved its original objectives, most of which were not monitored (only 29 of 66 targets were monitored) and many were not met.”
It notes that progress has therefore been slow with only five out of the 14 framework contracts it has set up being used by more than half fire and rescue services to purchase equipment.
Amyas Morse, head of the NAO, said: “The department must quickly make a decision about whether it is sensible to continue with a nationally directed central procurement body. If it concludes that it is, it must change the way Firebuy operates. If not, it should transfer its operations to another professional buying organisation.
“To deliver value for money for the taxpayer, public sector bodies should prevent the procurement of unnecessarily expensive bespoke equipment and collaborate successfully to build higher volume orders which reduce supplier prices.”
The NAO says the approach to measuring savings achieved by Firebuy is inadequate and the information that the estimated savings are based on is mostly unreliable. The department expected Firebuy to be self-financing by its third year of operation (2008-09) but the NAO says it is still heavily reliant on grants from the Department.
Most contracts allow suppliers to offer many variations of the same types of equipment. As an example, one for fire engines allows for 54 possible combinations of supplier, chassis, water pump and body type and a possible one million different specifications.
One difficulty is said to be that without the power to make local authorities use its national procurement contracts, Firebuy has had to rely on persuasion.
A DCLG spokesman said they were studying the NAO report and “we will consider the findings on Firebuy within it carefully.”