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Amidst increasing budget constraints, local authorities (LAs) are approaching recruitment spend with caution. However, it is more important than ever to find the right balance between cost control priorities and promoting recruitment procedures that are sustainable and deliver the right calibre of staff

One of the challenges is to ensure that procurement departments recognise the unique nature of recruitment services and do not apply the exact same principles and procedures as for the supply of stationery, for example. People are not commodities, each placement requires the same work in terms of sourcing and vetting and ensuring that the worker is suitable for the role. There is no ‘bulk’ buying when it comes to recruitment services.

LAs spend £1.1bn per year on agency staff, providing the public sector with a vital, flexible resource to meet peaks in demand. However, an Audit Commission report in December 2011 found that councils face a 26 percent cut in funding between 2011/12 and 2014/15 and predicted that workforce costs will be increasingly targeted as part of this.

There are already signs that cuts are impacting on the care sector. A recent report from consumer group Which? flags some worrying examples of poor practice, largely linked to insufficient staff numbers. Specialised recruitment agencies play a key role in ensuring that all front-line workers are suitably skilled, fully vetted, and that the need for extra staff can be met at short notice and on a 24/7 basis. However, increasing pressure on costs and margins risks this becoming an almost impossible task.

Agency spend is often seen as an easy target but we need to look at the benefits that flexible staffing arrangements provide rather than seeing it as a budget line to be systematically eroded. The ability to bring in specialist staff when there is a need – rather than increasing headcount – is a feature of cost-effective resourcing models in both the private and public sector.

National frameworks such as MStar (Managed Service to Temporary Agency Resources), promise significant cost savings. The priority must be to ensure that any new procurement exercise does not jeopardise the quality, safety and sustainability of supply and is commercially viable for SMEs in line with Government commitments in this area.

An interesting lesson can be drawn here from the London Olympics. Forward-thinking procurement procedures have been a key factor in the success of the project and evidence at a recent All-Party Parliamentary Group confirmed a focus on value and quality rather than on driving down costs. The same meeting underlined the importance of good recruitment with Andy Hunt, Chief Executive of the Olympic Association, making the point that “getting the right people in place, as well as the right culture and values, has been crucial”. These messages on procurement and effective recruitment will continue to resonate long after the Olympics circus has left town.

What is the way forward? One priority is to start seeing flexible staffing arrangements – such as temporary and contract staff – as part of the solution rather than part of the problem when it comes to cost-effective resourcing models. As part of this, framework contracts such as Mstar must strike the right balance between cost-control and quality of service and must be commercially viable for suppliers. As the representative body for the UK recruitment industry, the REC is committed to working with public sector employers to promote sustainable models and drive good practice through the supply chain.

For further information about the REC visit

Written by Tom Hadley
Wednesday, 21 March 2012 20:08

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