Monday, 3 September 2012

An exaggerated saving

There's a factoid popping up here and there on right-wing websites to the effect that that private-sector management at Hinchingbrooke hospital saved £1.6m on paper stationery.  Since the hospital's entire turnover is reportedly £105m, that seems wildly implausible.

In the absence of detailed accounts, one can't know exactly what's going on, but one can at least check the website of Circle, who are providing the management.  It tells us
£1.1m procurement savings banked.  £1.6m identified this year
So they've identified £1.6m savings on all procurement. It's surely impossible that the entire saving comes from the paper stationery budget. So how did this myth arise?  Well, according to the BBC, Ali Parsa, Circle's chief executive, claimed that
the company had saved £1.6m by ordering the hospital's paper supplies differently
and the Telegraph has him saying that
that on paper supplies alone they have saved £1.6 million
Which, in an editorial in the same newspaper, becomes
simply changing the way stationery was ordered, for example, saved £1.6 million
For one thing, "paper supplies" and "stationery" are not the same things. Hospitals use a lot of paper products - trays, bedpans, etc - for medical purposes.  But, more importantly, I think there's been a mistake somewhere along the way: my guess is that an assistant fed Ali Parsa with an example of something they'd saved money on, and a figure for all savings identified, and by the time he came to talk to the press he'd joined the two together.

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