Efficiency and reform in government corporate functions through shared service centres - Public Accounts Committee Contents

2  Recent performance

5. There have been inconsistent levels of progress in establishing shared services across governmentsome of the larger departments have consolidated multiple systems into single systems, and other departments have gone further and established their own shared service centres.[9] However, problems remain with performance information, inefficiency and low departmental take-up and an insufficient focus on customers.

6. In 2008, we concluded that: there was a lack of reliable information on the costs and performance of corporate services; and inconsistent recording of data was making benchmarking difficult.[10] In this session, we were extremely disappointed and frustrated to hear that the Cabinet Office still did not have good information and was therefore unable to compare the operational performance of centres. There was no measure of the quality of the services until the National Audit Office produced one as part of its report in March 2012.[11]

7. In terms of financial information, the Cabinet Office accepted that although cost data did exist in departments, it had not pulled it together in one place until 2011. Between July and November 2011, it told us that it worked with departments to gather and analyse costs.[12] The National Audit Office report identified large variations in the cost of shared service centres. For example, the Research Councils UK centre spends £1,600 per customer user compared to £500 per user in the Department for Work and Pensions' centre.[13] The Cabinet Office agreed that it was not sustainable to allow this to continue and said that it intends to more actively benchmark costs and use this to ensure that performance improves across government. The Cabinet Office accepted that an element of "persuasion" may be needed to encourage centres to achieve these benchmarks.[14]

8. Shared service centres were built without a confirmed number of users and the use of these centres by departments has been voluntary. Some centres have failed to attract users and continue to have spare capacity so have therefore not achieved economies of scale.[15] The Cabinet Office acknowledged that the "one thing that drives benefit and efficiency in shared services is scale."[16] Witnesses told us that the low uptake is because departments were sceptical about the shared services programme and wanted to see how the pilots worked before deciding whether they should join in.[17] We were also told that departments may have had concerns over the quality of services they would receive.[18]

9. Many of the customers of shared service centres have insisted on services that have been tailored to their systems rather than the shared service centre providing one process suitable for all customers.[19] This has resulted in overly complex systems and processes which are less economic. The Cabinet Office's new strategy proposes that shared service centres will provide the same "basic, simple and reusable" process for all customers.[20] Whilst this is welcome, the Cabinet Office must be able to ensure much greater usage of the centres on this basis.

10. Witnesses accepted that departments have invested more in setting-up the infrastructure for shared service centres rather than focusing on the user experience. Specifically, departments did not give sufficient attention to the cultural changes required, with users in customer departments struggling to understand what benefits shared services meant for them. For example, departments did not spend enough time getting the business users trained on how to use new systems. More positively, we heard about the Department for Education's experience of joining the Department for Work and Pensions centre and the importance of classroom training for their staff on the new systems. [21] In its report, the National Audit Office described the Department for Education as having one of the most advanced intelligent customer functions, with regular communication, partnership working and a focus on cost management.[22] We heard that the Cabinet Office intends to share the experiences of the Department for Education to demonstrate to other departments the benefits they would gain from joining a shared service centre.[23]

9   Qq 2-3, 27 Back

10   Committee of Public Accounts, Eighteenth report of Session 2007-08, Improving corporate functions using shared services, HC 190, conclusions 1-2. Back

11   Qq 22, 59-62 Back

12   Qq 26-30 Back

13   Q 66, C&AG's report, Figure 5.  Back

14   Qq 30, 51, 58 Back

15   C&AG's report, para 11 Back

16   Qq 58, 109 Back

17   Q 24 Back

18   Qq 17, 34 Back

19   Qq 68, 73 Back

20   Qq 73-74 Back

21   Q 10 Back

22   C&AG's report, para 2.8 Back

23   Qq 52, 108 Back

previous page contents next page

© Parliamentary copyright 2012
Prepared 9 July 2012