This is a House of Commons Committee report, with recommendations to government. The Government has two months to respond.
This is the report summary, read the full report.
Efficiency savings are essential so that government can deliver more with less, or deliver more effectively with existing resources and make best use of taxpayers’ money. Since 2013 the Government has sought to make certain functions more efficient by setting up groups of professionals who work across government to provide expertise in areas such as human resources, procurement, or finance; these groups are known as ‘functions’. There are now 14 functions, which are integral to delivering efficiency savings. But despite their potential, they currently vary in terms of their activity, maturity and approaches to savings.
Functions have so far helped save over £6.8 billion of taxpayers’ money. But it has taken nearly ten years to start calculating the efficiency savings made by the functions. While most have a clear methodology in place, some still do not. Cabinet Office’s exercise to report the efficiency savings delivered by the cross-cutting central functional teams is a good start, but there is much more to do to improve the rigour, completeness, and credibility of reported savings. The actual efficiency savings made by the functions, and therefore the amount of taxpayers’ money that could be used elsewhere, may be much higher.
At a time of ever-increasing pressure on public finances, it is vital to hold the whole of government to account for achieving, and properly reporting, savings. We welcome HM Treasury’s new framework, which broadens reporting on efficiency savings beyond the work of the functions to the activities of all government departments. Learning from the Cabinet Office’s exercise, HM Treasury now needs to ensure figures are robust and consistent so they are useful for decision making. Without clear criteria for consistently reporting savings there will remain the risk that savings from efficiencies reported by one function will simply entail higher costs in another, or that savings will be counted twice by departments and functions. HM Treasury and Cabinet Office need to maintain and, in places quicken, momentum so that more savings can be identified and the money saved put to good use.