Public sector looks to leasing
for best use of its money. Claire Hack reports.
Go deeper with GlobalData
The government’s Comprehensive
Spending Review (CSR) could open up fertile new ground for leasing,
providing that lenders can market their product effectively.
“Anything associated with public
finance in the next six months is going to be important,” said
George Lynn, chief financial officer at Angel Trains, and chair of
the Finance and Leasing Association’s (FLA) asset finance
division.
“I’ve been talking to people in the
public sector who are looking at leasing as an option for saving
money. It’s about making better use of money rather than simply
cutting costs.”
Due to report on 20 October, the
CSR will result in tough spending cuts in all publicly-funded
organisations.
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By GlobalDataSiemens Financial Services (SFS) is
poised to take advantage of any increased appetite for leasing.
Chris Wilkinson, SFS head of sales
in public sector and health care, said: “We’re putting together
indicative quotes to help customers make informed decisions on the
most appropriate use of financing. This sort of work has increased
recently, which normally leads to more equipment being leased.
“The amount of capital available
will be reduced so people will be looking to pay through revenue
expenditure. They look to us to take the residual value risk, and
take equipment off their balance sheets.”
SFS funds a range of assets for
public sector, including commercial vehicles and dust carts.
In the push to supply leasing
contracts to the public sector, NHS Supply Chain was singled out as
a possible blueprint for best practice.
“The NHS has put procurement into a
single entity and recognised that leasing is a great way of
acquiring assets,” said Lynn.
“There’s no reason why that can’t
be put into areas like education. If you want to keep using assets
you have to find better ways of procuring.”
A good asset finance company could include services such as
training in contracts. Lynn said: “Leasing companies have seen this
coming for two or three years. They’re looking at more efficient
ways of doing things.”
