Firms in Harrow and Hillingdon are losing £32.8m to procurement fraud, according to new data.

New research has shown that they are losing money on how they do business by procurement and efficiency experts blur Group.

The government’s annual fraud indicator reveal that £32.8m a year is estimated to have been lost to procurement fraud by businesses in Harrow and Hillingdon and a further £5.5m by the public sector in the county.

The figures were released by the blur Group organisation, whose cloud software and managed services platform helps companies and councils eliminate waste and inefficiency in their procurement processes.

Procurement fraud is any fraud relating to a company purchasing goods, services or commissioning construction projects from third parties.

It is recognised that 20 per cent of all spend by organisations is unmanaged and often un-contracted.

This means it is at risk to procurement fraud, the second most frequently reported form of economic crime.

In comparison with its neighbouring borough, according to its data, Barnet has lost £18m (£15.6m by companies, £2.6m in local government) through procurement fraud.

Blur Group CEO Philip Letts: “The figures are shocking but Harrow and Hillingdon 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.

“What I do find encouraging is that the problem is starting to be recognised and there is huge potential for organisations to do something about it.

"Some companies and councils are now beginning to tackle the issue, looking in detail at the cost and impact it has, improving processes to become more efficient and moving quickly to address inefficiencies to prevent failures to get the best price and mitigate the risks from rogue spenders and deliberate fraud.”