Buying Time: A CIPFA Pensions Panel Guide to Procuring Efficiency in Public Sector Pensions Administration

Over the course of the last decade, the efficiency and effectiveness of the way in which the public sector has procured goods and services, and delivered services (both internally and to the wider public) has been subject to a series of governmental reviews aimed at improving the way in which government at all levels utilises its spending power. As with any other activity undertaken by the state, public sector pensions administration has come within the scope of these reviews, with mixed responses and outcomes.

With the government announcing significant cuts to public spending in the 2010 spending review, it is not surprising therefore that Lord Hutton made the following statement in his interim report into public sector pension schemes:

“The Commission understands that there is wide variation in the administration costs across schemes in the public sector, the rationale for which is not always obvious. Furthermore, these costs, at least sometimes, appear to be higher than those of similar schemes in the private sector. The Commission’s final report will therefore consider pension scheme administration costs and the scope for rationalisation and cost reduction. This will include possible simplification and consolidation of functions across different schemes and units within a scheme. For example, the Commission has received evidence about the numbers of LGPS funds and how costs vary between them and possible efficiencies if that number could be reduced.”

This report investigates the current public sector procurement framework as it applies to pension schemes, supplemented by some topical case studies that demonstrate the latest thinking in procurement and service delivery practice. All of this is set in the context of the drive toward effective procurement in recent years and the most challenging public sector financial settlement in decades.

This publication is available in PDF format.