Procurement fraud is costing Lancashire businesses Â£53m a year
Companies in Lancashire are unnecessarily losing Â£53m a year according to research by procurement and efficiency experts Blur Group.
Figures released from analysis of data used by the Government’s Annual Fraud Indicator reveal that £53m a year is estimated to have been lost to procurement fraud by businesses in Lancashire.
A further £9m has been lost by the public sector in the county.*
It is recognised that some 20 per cent of all spend by organisations is unmanaged and often un-contracted, and so at risk to procurement fraud, the second most frequently reported form of economic crime.
The impact of practices such as deliberate bid rigging and rogue spending includes increased and unnecessary costs, reduced profits and ultimately higher prices and bills passed on to consumers and taxpayers.
Blackburn with Darwen has lost £6m (£5m by companies, £872,000 in local government), Blackpool £4.7m (£4m by companies, £684,000 in local government), Chorley and West Lancashire £8.8m (£7.5m by companies, £1m in local government), Lancaster and Wyre £8.6m (£7m by companies, £1m in local government) and Mid Lancashire £21m (£18m by companies, £3m in local government).
Blur Group CEO Philip Letts said: “The figures are shocking but Lancashire is not alone on this issue. As well as private sector companies wasting millions of pounds of their own potential profit and operating under a tighter financial burden, a major aspect of procurement fraud falls within the public sector which means taxpayers’ money is being wasted too.
“This part of an organisation’s spend is largely unmanaged, meaning many are not even aware that the issue is so prevalent.”