WA Government Purchasing Card

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WA Government Purchasing Card
Promoting Best Practice for Efficient Procurement
2
Background

• Governments Procurement Reform Deliverable C
  approved project
• To investigate constraints hindering Purchasing
  Card usage and develop a strategy to promote
  growth of cards for buying low value, high volume
  items
• Department of Treasury and Finance Growth Project
  Team Established
• The project objective is to assist Public
  Authorities to unlock and deliver savings from
  the increased use of the Purchasing Card in
  accordance with best practice.

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New Contract

• Commenced July 2004
• Mandatory Sole Supplier National
• Card Type VISA
• Cost No cost to issue cards no ongoing fees.

4
The Opportunities

• Analysis of the 7 largest spending Agencies shows
  that approximately 97 of Purchase Orders raised
  were for purchases below 5,000, while this only
  constituted 25 of the value of all Purchase
  Orders raised (2006 Figures)
• 1 million transactions lt 1,000
• further 100 000 transactions lt 5000

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Current Landscape
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WA Government Targets

• 2008 Transactions lt 5,000 40
• 2009 Transactions lt 5,000 60
• By 2010 end of contract term
• Transactions lt 5,000 80
• Number of Cards 15,000 (currently 9010)
• Annual Spend 400 million (currently 112m)

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Benefits

• Simplified procurement process and convenient
• Simplified payment process
• Efficient
• Automated payment to suppliers within 48 hours
• Maintains a high level of visibility and audit
  compliance

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Benefits

• Increased Transparency (EMS)
• EMS visibility, workflow, reporting alerts
• Simple, easy to use EMS user support
• Automatic downloads to finance systems
• Survey results show savings from 19 to 52
• New CUA terms prevent charging of Merchant fee
• Efficiencies gained through making card available
  to staff required to undertake purchasing

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Perceptions V Actual

• Perceived potential for unauthorised buying
  (trust)

• Loss of management control

• Difficulties with statement reconciliation

• Lack of direct interface with Finance systems

• Efficiency savings are not considered real

• Added cost from suppliers (Merchant fee charged)

• Status symbol, cards not to be issued to lower
  level staff

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Strategies to Increase Card Use

• Issue cards to regular users of Petty Cash.
• Issue cards to staff undertaking travel and
  encourage use.
• Identify and issue cards to staff required to
  regularly purchase goods services.
• Run series of short sessions with administrative
  staff involved in purchasing. Highlighting
  opportunities to use card, and provide support
  and encouragement in the use of the card.

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Strategies to Increase Card Use

• Raise Purchasing Card at Team Meetings, promoting
  support for use.
• Mandate use of Purchasing Card for specific
  purchasing or for specific range. ie Catering,
  stationery, or appropriate purchase under 5000.
• Identify opportunities and methods for using
  Purchasing Card through online purchasing
  systems.
• Establish current usage (benchmark), track and
  report on achievements against targets

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Policies

• WA Government Purchasing Card Policy
• (OGP PurchasingCardhttp//www.dtf.wa.gov.au/cms/
  pro_content.asp?ID1658)
• Financial Management Act 2006
• Treasurers Instructions 321
• Agency Specific Purchasing Card Policy
• Agency Specific Purchasing Policies
• 
  
  
  DMS6455732