4 Efficiency savings
34. The Department has a target to achieve an annual
2.5% efficiency improvement across the Department; which can be
achieved through:
- Increased outputs/outcomes
for the same inputs;
- Constant output/outcomes from reduced inputs;
- Reduced inputs from sunsetting unnecessary activities.
The Annual Report noted that the Department would
meet its target for efficiency savings in 2003-04. It also indicated
that work was being undertaken to prepare an Efficiency Plan for
2004-05, which would be underpinned by the emerging findings of
the Gershon Review.[27]
The Department has now published Efficiency Technical Notes on
its web site.
35. We welcome the success of the Department in meeting
its 2.5% administration costs savings target for 2003-04 and in
producing a plan of how it intends to achieve and measure efficiency
savings across the 2004 Spending Review period, in line with Government
requirements. While the previous targets for reduction were set
in relation to the Department's administration costs, the new
targets cover the entire Departmental Expenditure Limit. However,
while the Efficiency Technical Note included extensive information
about the validation and reliability of its measures, the Autumn
Performance Report provided no information how the savings it
reported had been validated. We recommend that when it reports
progress against its efficiency targets, the Department notes
how that progress has been independently validated. In addition,
we expect the 2005 Departmental Report to demonstrate that the
expansion of efficiency targets to cover the whole Departmental
Expenditure Limit, as opposed to purely the administration cost
element, has not affected the quality of service delivery.
36. As a result of the Gershon Review of Government
Efficiency, the Department for Transport is expected to realise
total annual efficiency gains of at least £785 million by
2007 -08. We note that much of the saving will come from transactional
services in the Driver, Vehicle and Operator Programme, from roads
procurement programmes, by both Highways Agency and Local Authorities,
and from local authority and Transport for London non roads programmes.
We will be interested to see how much of these gains can in fact
be secured, particularly given that many of them are expected
to come from e-delivery of services within the Driver and Vehicle
Operators group.
37. We were surprised to see that funds raised from
introducing a Fixed Penalty system for Heavy Goods Vehicle and
Passenger Services Vehicle operators were included in the Efficiency
Technical Notes, even though no forecast is given of the revenue
expected to be raised through fixed penalties. The baseline for
such funding was zero. The Vehicle Inspectorate certainly enforced
matters such as drivers' hours and vehicle condition previously;
we find it hard to believe that the introduction of fixed penalties
will have absolutely no effect on the level of penalties imposed
by the court or the Traffic Commissioners.
38. We strongly support introduction of a fixed penalty
scheme. Unroadworthy lorries and buses cost lives, and tired drivers
are a risk both to the public and themselves. Since the police
are devoting less effort to policing on the roads, it is right
that VOSA should have powers to enforce the rules. We expect that
the number of operators penalised for breaches of the rules will
increase sharply once a proper fixed penalty scheme is introduced.
We support that, too. However, we believe including receipts
from fixed penalties among departmental savings sends the wrong
signal. Fines are a penalty for lawbreaking, not a tax. Including
that revenue in the efficiency savings gives comfort to those
who claim that law-enforcement is about raising money rather than
saving lives. It should be removed.
39. When we took evidence we asked about the realism
of the department's targets for relocating staff away from the
South East, we were told:
Mr Darling: A
lot of our redeployment took place over the last two or three
years, and we will continue to do that. I will give you one example:
many of the staff at the new Rail Accident Investigation Branch,
for example, will be in Derby; they do not need to be in London.
... We have moved more staff down to Hastings which, although
it is in the South East, is an area which does need help, and
also we have proposals to reduce the head count of the department
further.
Mr Rowlands: ….
It was commonly agreed that we would not move staff out of Hastings
because it is a depressed area, albeit in the South East, and
we would not move staff out of Southampton because that part of
Southampton is one of the 88 Neighbourhood Renewal areas. So it
is really just about the staff at headquarters level.[28]
40. We note that the Efficiency Technical Notes now
identify 37 headquarter posts which will move (or have moved)
from London. There are plans to increase the administration services
shared by the Department and its agencies, and some of this work
may be moved from London.[29]
There are also proposals to reduce the headcount of the central
department by 200 by 2006-07. The total Department for Transport
workforce for 2004-05 was 17,492; of these, around 1,400 work
in headquarters in central London. The majority of the others
work in Agencies located outside London. We are unsurprised that
there is little scope for relocation.
27 Appendix D, p.139 Back
28
Q 9 Back
29
Q 12 Back
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