UK Government savings – half year results announced

This morning in the impressive Churchill Room of the 100 Parliament Street government building, we had a press and analyst briefing around the UK Government’s Efficiency and Reform Group (Cabinet Office) savings for the first half of 2013/14.

The numbers are at first sight impressive as you might expect, although we haven't done any due diligence on then as yet. The gross figure is £5.4 billion, made up of -

£0.6B Transformation (digital, shared services and property – e.g.vacating 260,000 SqM of space)

£0.7B Projects – saving on major projects around government

£1.8B Commercial – all the usual procurement stuff

£2.3B Workforce – 80,000+ fewer civil servants than 3 years ago.

There was less focus than previously on procurement, which is interesting. The main topics covered in the speeches (from Francis Maude, Stephen Kelly, ERG COO, and Sajid Javid, Treasury Minister) were shared services, digital and property, I'd say.

Digital was not only about better services, but how using more small and innovative suppliers is helping them grow and “delivering better services at lower cost”. That's a very powerful message, and is going to be something we hear a lot about over the coming years of continuing public sector austerity. And certainly in the case of some digital initiatives, the government has delivered – applying for a driving licence, or farm subsidy claims were two examples given which are genuine.

The new Shared Services joint venture with Steria was plugged hard. Running the procurement process in just 6 months is one aspect which Kelly is (justifiably) proud of. Unfortunately, I didn't get the chance to ask my question about the potential offshore element of it, although I did ask that question to an official after the session – we'll come back to this in another post.

The audience questions majored on Serco and G4S, perhaps not surprisingly. Maude and Crothers were cautious as you might expect – we want to have a vibrant market for providers of those services, and we are committed to outsourcing was the message. But Maude made the interesting comment that he expected “more new entrants to be coming into that market”. I'd be somewhat jittery if I still owned shares in some of the current big providers!

There was one other throw away remark about procurement which we'll also come back to next week when we look in more detail at some of the points from the session, but I came out of the session feeling that – for all our issues around certain aspects of the procurement agenda in particular – Maude's achievement and reputation is in the credit column overall!

And he made another excellent point. None of his previous 8 predecessors stayed in their job for more than 18 months. He has been there for 3 and a half years now. And there's no doubt that he has made things happen because of that tenacity and stability that peripatetic Ministers just couldn’t have done.

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Voices (2)

  1. Dan2:

    Agreed Trevor. I wonder how many of those 80,000 civil servants were being outsourced (and therefore the costs just moved to service charges from suppliers); or am I being too cynical?

  2. Trevor Black:

    Sorry but the days in believing any figures trotted out from within Whitehall are long gone. Not even the politicians believe or relate to them – the term “billion” is meaningless and Mr & Mrs Average only understand that it is a figure used as an attempt to impress with lots of those little noughts in it. When the official estimated cost of HS2 went up this year it was only by 20 billion (yes ONLY) and this of course was quickly followed by yet another version of the business case. What would be taken more seriously is when Whitehall starts producing figures on cost avoidance! That alone would pay for HS2. Does anyone recall the term billion being used prior to the banking crisis?

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