by Rebecca Walker — April 29, 2011—The market value of U.K. government outsourcing is expected to slightly decline in the next several years, despite more outsourcing activity, according to a new report.
In 2008, the market value was £4.08 billion, rising to £4.21 billion in 2009. A further increase has been estimated for 2010, reaching £4.26 billion, noted the report Facilities Management Outsourcing – Central and Local Government Markets – UK 2011-2015.
But this year, 2011, the market value is forecast to drop to around £4.23 billion, and decline further in 2012 to £4.19 billion.
The “conflicting picture,” said Keith Taylor of AMA Research, which carried out the work, is due to government looking to save money on its contracts.
“Governments told us they expect to outsource more but will be looking to drive down the cost of these contracts,” he told FM World.
The report — which excluded health care and education from local and central government outsourcing estimates — focuses on the provision of multi-service, or integrated, contracts.
Uncertainty in the global financial market resulted in some slowdown in FM outsourcing, with fewer opportunities for market expansion.
The report said there is hope that budget cuts will see departments, particularly in local authorities where FM penetration is lower, moving toward greater levels of outsourcing and bundling of services in order to meet efficiency savings. Larger contracts could become available. For more
For more information or to purchase the report, go to the AMA Research Web site.
