Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses(Questions 40-59)



  40. You have just told me it is useful to provide information about the Budget, not where the word Budget comes from.
  (Mr Pinder) I think it is useful to have that sort of information because a lot of people who use this site are school children. We know, for example, that the UK Online site is extremely popular with schools because for politics lessons and so on it provides a great deal of information about government with a very easy-to-use search engine, and it is extremely popular, particularly with school children from 14 years old onwards. We have done a lot of research into that area. That is one of the reasons why we do try to make our site accessible, not just to professionals like people in this room but also to people who are not professionals but ought to be taking an interest in the whole process of government, and that is an example of us trying to do just that.

  41. I do not disagree it is nice to have historical information and, as I said, the Downing Street website is quite good on that kind of thing. I suppose the question I am getting to is, is it worth all the money? Great for school kids to have websites about the history of our country and so on, but, as I understand it, you are spending £1 billion in the next three years on this technology. What is the total amount of money that the Government has spent on websites and so on to date?
  (Mr Pinder) It is very difficult to disentangle the money just on a website from the largest sum of money, the £1 billion you referred to, which is the money from the last spending review which has been spent on e-enabling government including some substantial changes to their existing systems. That £1 billion of course includes the £350 million which went to local authorities to help them get on-line. So for central government you are talking about £650 million on a variety of IT projects which have a substantial aspect of "e" in them but also do other things. It is not possible to tell you how much has been spent on government websites because they have been built up over a number of years and we have not collected that information. It might be possible, if it would help this Committee, for us to go and collect the information for what websites have cost for the top half dozen departments, just as a sample, to give you an indication.

  42. I think it would be quite useful to know how much money has been spent on developing all these websites. It does say in this report, in paragraph 4.28, your office has, ". . . somewhat out of date and incomplete information about the condition of central government web sites, the take-up of electronic services at present across central departments and agencies, and the extent to which the claims made in the e-business strategy documents correlate with the actual progress of on-line services." Here are hundreds of millions of pounds being spent and actually central government has no idea whether that money is being well spent or not.
  (Mr Pinder) There are a number of departments which spend their time making sure government gets value for money, of which principally the Treasury play a part. My office is there to make sure people are making progress towards the 2005 target in this particular area and that is what the e-business strategies were designed to do, to demonstrate what people's plans are and from one strategy to another how they have made progress. We keep regular up-dates of how many of these services have to be on-line. We produce and publish that information so it is regularly available to them. We have readily accessible availability of information about government services going on-line, and we now have 51% of all government services being on-line, for example. What we do not do is regularly go out to departments and ask them what are the number of people using their sites, though increasingly the emphasis of my office is turning not just simply to hitting the 2005 target but increasing the use of this technology. I mentioned that when I was talking to Mr Jenkins. I think it is important that government departments pay attention to the number of customers using their sites, they should pay attention to getting that number up and we will want to encourage them to do that.

  43. But you do not have any idea whether you are getting value for money for all this money being spent.
  (Mr Pinder) I think the Treasury, in looking at its spending within individual departments, takes a great deal of care to make sure it is getting value for money. On a project by project basis, attention is paid to that, and we make sure either an improved service or better delivery of services is provided or in actual resource savings we are making some savings. But that is best done on a project by project basis. Often the `e' part of a project is only one part of an individual project.

  44. How much did it cost to get your main website up and running?
  (Mr Pinder) To get the UK Online site up and running originally cost about £15 million.[2]

  45. The American Government did it for 4 million dollars.
  (Mr Pinder) That is very interesting. I was recently talking to Mark Forman, who is effectively the chief information officer for the American Government in the Bush administration, and he was saying they have spent a great deal more money than that, something in the region of 50 million dollars, trying to get central and federal government websites on line.

  46. Websites.
  (Mr Pinder) Having heard what you have just said, I will tackle Mr Forman because I will be seeing him in about three weeks' time.

  47. I have not spoken to your friend but it says in this Report, "In the USA, the official web portal to US government information, FirstGov, was created in September 2000 under contract to the US General Services Administration, at a modest initial cost of 4 million dollars."
  (Mr Pinder) I think we have all of us found that first implementation of these sites, getting them up and running, for example our site,, cost a very small amount of money—

  48. How much?
  (Mr Pinder) But then we, in the UK, and the Americans as well, have spent a substantial amount of money since the very first appearances of these sites enhancing them.

  49. Keeping them up to date?
  (Mr Pinder) Yes, keeping them up to date and keeping their facilities modern. I am not entirely sure whether, in the question which was asked on behalf of the NAO, the US Government were referring to the 4 million dollars as being the very first implementation of the site, I would be deeply surprised if it was the cost to date of setting up, running and enhancing that site. In fact I have strong indications that is not the case.

  50. Generally this report suggests other countries' websites have a much higher take-up relative to their population than the UK. Do you accept that?
  (Mr Pinder) Many other countries have had a higher take-up of e-government services relative to their use of other services. If I can try and elaborate on that, I would agree with you that we, in the UK Government, have lagged behind other parts of the UK commercial sector in encouraging use of our services on-line, for example, compared to banking. We have not made as much progress in getting customers on-line as the banking sector have. I would agree absolutely there. If one looks at other countries, particularly European countries, and their use of government services in absolute terms compared to their population, no, I would not agree with you. We have made okay progress compared to the larger European countries. That is not to say we have made good progress against some of the smaller European countries, places like Finland and so on, where the use of government services on-line is far in advance of ours. I would accept a general criticism that we are not anything like as advanced in our provision of government services on-line as we should be. We should do much more.

  51. Would you accept in any way the argument you are behind the curve on what the private sector are doing? The private sector was extremely excited about all this technology and a lot of companies were set up, hundreds of billions of pounds were spent on all sorts of e-based things, there was a crash and that was that. However, because you are in government you have been insulated from all this and billions of pounds have been spent, hundreds of people have been employed by the Civil Service, and you just churn out these websites and no one is keeping track of how many people are looking at them, and so actually you have not followed the new trend in the private sector which is to not assume everything can be done on-line, that other things need to be done.
  (Mr Pinder) I think one of the few advantages of being, as you put it, behind the curve in getting services on-line is that we have been able to learn from the private sector and we have spent a great deal of effort trying to make sure we avoid the sort of errors they were making. That is something Customs & Excise are trying to do, for example. I do not accept there are sites out there which are, as it were, the equivalent of some of the catastrophes one has seen in the private sector and in the madness which followed the boom. I absolutely agree with you that we need to work harder at making our sites more attractive and more successful. I do not accept the money so far has been wasted but we have a lot to learn and a lot to develop.

  52. Can I ask a question of Mr Broadbent? We had an earlier meeting on e-government and we were speculating about how many—I do not want to use the phrase "jobs would be lost"—posts would disappear if we were fully on e-government. Do you think for Customs & Excise you see great potential for removing some of the more routine clerical jobs and administrative jobs, maybe redeploying those people elsewhere in the Civil Service, that there is great potential in that direction?
  (Mr Broadbent) If I may say so, the key word in that question was "full potential". The existing strategy, and it is probably right it should be measured, is designed to make services available on-line, and it is not to exploit the full potential of e-enabling organisations such as Customs & Excise. As I said earlier, having learnt from what we are doing, we are developing a slightly different approach based on what we had before which would offer the opportunity of exploiting the full potential, and we are discussing this at the moment with ministers. That approach, as I say, goes much more into changing the nature of the underlying processes, and will offer material opportunity to do any one or more of several things, to change the level of services which we are providing, to reduce the cost of using our services for those who are using them, to improve the output of our service which effectively is tax compliance and fraud, an issue we are very familiar with, and to reduce our input costs because clearly some of the existing processes would change. The extent to which in that full situation you took advantage of one or more of the mix of these things would depend on whether people would be re-skilled, redeployed or moved on. Clearly certain existing functions would vanish. How you took the benefit from that is a debate we ought to have.

  Mr Rendel: I hope Mr Osborne's website is up to date otherwise I can see the witnesses taking their revenge on him.

  Mr Osborne: It is up to date.

Mr Rendel

  53. Can I start by asking what is rather a basic question, and I apologise if by any chance this was asked by the Chairman before I arrived because I was a few minutes late today. Is the Government's use of the web cost effective?
  (Mavis McDonald) The difficulty we have is we are having a discussion about just the web and we have quite clearly moved on from just the web in terms of our thinking about the whole range of potential for using e-communication and delivery of services through electronic means, since we first started to work on the programme of meeting the Prime Minister's targets. I think that again, as Andrew Pinder said, the use of the web pre-dated the current drive, a lot of departments have websites which are about the provision of better information, faster to more people. One of the things we have not talked about around the table, which seems to me quite important, is that one of the purposes of the web is effective communication, and I do not know we properly have ourselves thought about how to quantify and cost that in, but I think we are probably missing a trick there. For example, on things like public consultation, we are able to consult much faster, more fully with a wider range of people with access to websites, than when we used to send everything out in hard copy. We have the ability, as Andrew described, to put out for public consumption information in different manners and approaches and styles, which makes it much more accessible to a potential wider range of readers.

  54. You seem to be saying, if I can cut you off there, that the use of the web by the Government has various values and various advantages which have a value?
  (Mavis McDonald) Yes.

  55. What you also seem to be saying to me is you have no idea at present what that value is as compared to the cost of using the web?
  (Mavis McDonald) I do not think we have a comprehensive picture of what all the costs and benefits are. There are certain areas, largely those which come through major significant projects, where the Treasury does do a full cost benefit analysis of what you are trying to achieve. There are things about the capacity to improve putting out information, and that has led to service delivery improvements on things like NHS Direct where we might be able to take a line on financing through, but I would not want to claim that we have the kind of full assessment of the range of what the benefits are or more information being available through this particular aspect of e-technology.

  56. The basic purpose of this Committee, as I understand it, is to be Parliament's check that public money is being spent in a cost effective manner. When I ask you whether this amount of public money is being spent in a cost effective manner, you tell me you do not know. Clearly there are values, I think we all accept there are values, in using the web but it is difficult for us to come to any proper conclusions if you simply do not know the value of what you are doing.
  (Mavis McDonald) I did not want to imply we are not trying to understand more about this and understand what we get out of it. For example, Andrew is advertising UK Online and he has done a lot of detailed evaluation of what the take-up and pick-up is.

  57. When will you know if the Government's use of the web is cost effective?
  (Mavis McDonald) We did say earlier we do not centrally, collectively, pull together the detailed information about the usage of individual departments' websites. We give guidance on what the departments do, we audit in the office—

  58. I understand you are not doing that now but what I asked was, when will we know whether the Government's use of the web is cost effective?
  (Mr Pinder) Can I offer an alternative way of putting this. As I said before, we in this question are looking across Government as a whole, but if one breaks that down and says, "Is the use of the web to deliver a particular service a cost effective way of doing that", then the case for spending the money in order to deliver that service electronically is made at the time the money is requested, and that is a case which will be made to the Treasury. We would say, "We want to spend this amount of money to deliver the following benefits." So in exactly the same way as building a new road or a new hospital, a business case is made to take a particular action which delivers an individual service or a range of services. So the case is made up front and the Treasury have to be satisfied it is a good case.

  59. For all your new uses of the web, a case will be made in each case that each one is cost effective? What about those which did not go through that process and therefore you do not yet know whether they are cost effective? That presumably was what Mavis McDonald was saying in effect that if you take the overall picture, we do not yet know, but we may know for certain particular uses of the web that they are cost effective, but we do not know the overall picture because there are other uses of the web for which we have not done that evaluation process.
  (Mr Pinder) Where people have come along and asked for money to improve a service or deliver a new service, a business case has to be made and has to be proved.

  Mr Rendel: I understand that.
  (Mr Pinder) And it is subject to audit whether that business case is met or not, and that is part of what the Treasury do and what the NAO do. So business cases are made to spend some money but I agree with Mavis McDonald that that gives a very narrow feeling for what the benefits will be. We do make the business cases and in fact virtually everything we do in spending money on the UK Online website will have had a business case, albeit it is one around softer benefits about making people more effectively linked to other people's websites and so on. Those cases are made. I think there is a wider benefit, and I think this is what Mavis McDonald is referring to, in making information much more readily available to people which is not costed because we are delivering something which people could not otherwise have at all and therefore we are not saving costs elsewhere, we are just delivering more information. A good example of that might be the NHS Direct site which gets a very large number of visits every day, it is a service which just was not available before, and there are clearly hard benefits in relieving the load on doctors' surgeries and so on, but there are also in my view softer benefits in relieving people's minds who wake in the middle of the night with an ache and pain, they can access the site, have a look at it and it can help to ease their worries or at least realise they should go and see a doctor. So there are both hard benefits, particularly when we are delivering a transaction on-line where a business case is made and where the benefits can be delivered, and we can do the inquest as to why they were not afterwards, but there are also a whole range of softer benefits where we do not know enough about things because we are still learning, as indeed are people in the private sector.

2   Note by witness: The cost was actually £4.7 million up to the initial UK launch in February 2001. Back

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