New Bumper Book of Government Waste exposes £120 billion of wasteful spending – that’s £4,500 for every household in the UK
Jun 2013 15

In advance of the Comprehensive Spending Review, we can reveal how the Government could cut vast swathes of wasteful and unnecessary spending. A new online edition of the Bumper Book of Government Waste, published today, identifies potential savings to the tune of nearly £120 billion, a figure almost exactly equal to the current budget deficit. This equates to a massive £4,500 for each and every household in the UK - enough to give every family in the land a luxury holiday or pay their household energy bills nearly three times over.

Excellent work has been undertaken by the Cabinet Office’s Efficiency and Reform Group in terms of finding savings, but taxpayers’ cash has still been wasted in a number of ways, with significant sums ripe for being saved in many areas, including:

  • £53 billion - Additional cost of funding pay and pensions for public sector workers over and above the private sector average, based on analysis of figures from the Office for National Statistics and the Pension Policy Institute
  • £25 billion - Amount wasted through inefficient public sector procurementand poor use of outsourcing, based on an authoritative report from the Institute of Directors
  • £20.3 billion - Cost to the economy of public sector fraud, according to the National Fraud Authority
  • £5 billion - Amount paid in benefits to those with an income in excess of £100,000
  • £4 billion - Losses to the taxpayer from RBS and the sale of Northern Rock
  • £2.9 billion - Amount spent needlessly by the Department for Business, Innovation & Skills and Department for Culture, Media & Sport, which should both be scrapped
  • £1.2 billion - Annual subsidy to foreign farmers through the EU’s Common Agricultural Policy

Our figure is almost certainly an underestimate. A rigorous assessment of the public sector efficiency commissioned by the European Central Bank found that if the UK’s bloated  public sector were as efficient as that in the economies of countries like the US, Australia, and Japan, no less than £137 billion could have been saved in the last year.

In addition to the big ticket items, we have identified hundreds of examples of smaller sums being wasted. It is, however, all still taxpayers’ money and there is no excuse for waste, regardless of the amount involved. Among the culprits identified are:

  • Arts Council: Gave a £95,000 grant to artists in Brighton for “Skip”, a rubbish dumpster outlined with yellow lights
  • Crawley Council: Spent £5,070 on 12,200 hot drinks from vending machines for council employees, when the equivalent number of tea bags would have cost just £200
  • Department for International Development: Spent £21.2 million on a road maintenance project in Bangladesh, later pulled due to “fiduciary irregularities” after it emerged that less than 10% had actually been spent on roads
  • Durham Council: Funded a £12,000 clothing allowance to allow councillors to wear “Geordie Armani”
  • Hull Council: Spent £40,000 on a concert in honour of the councillor who is Lord Mayor this year
  • Ministry of Defence: Paid £22 for light bulbs that are normally 65p
  • Prison Service: Paid £720,000 to professional actors for role playing that is aimed at helping inmates become employed
  • Scottish Government: Signed a £1.4 million 4-year contract for taxis for civil servants in Edinburgh – despite staff being told to use buses
  • Stoke-on-Trent Council: Spent £330,000 to pay for redundancy packages and subsequently rehiring 25 members of staff

Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance, said:

“George Osborne must take the golden opportunity offered by the Spending Review to get the nation’s finances under control and ease the burden on taxpayers. The latestBumper Book of Government Waste shows that tens of billions of pounds are still wasted each year and there is an enormous amount of fat left in the public sector.

“If Ministers do something about it, they can give taxpayers a better deal and still provide the frontline services which people depend on the most. More money must be left in the pockets of struggling households who need it to support their own families and their own causes. They will get better value than any politician or bureaucrat.” 

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  • blarg1987

    I admit some of this report is useful but other bits are very selective, i.e. 53 billion extra for public sector pensions over and above private sector average, is a poor research as it should be LIKE for LIKE jobs, also as numerous reports have shown, many bottom end public sector jobs are now classified as private sector jobs pushing the mean average of public sector income up. Also many private sector companies have had to increase into pension contributions just look at CEO’s in the FTSE 100.

    Also you note Crawley Council, again no;t a like for like comparison, as you have not included milk costs, sugar costs, coffee costs, transportation of good to the office, heating the water (which can be quite expensive) as well as stocking the machines and costs of cups.

    • Alexsandr

      ‘transportation of goods to the office. Sandra from accounts would go to tesco in her lunchtime, surely?

      • blarg1987

        Depends if she was going for an officee of 10 or an office of 1000, add to that the TPA imply outsourcing of services to save tax payers money and therefore want accurate costs to justify privatisation, however if their own researchers are not willing to do the same in their research then it is hippercritical.

        • SadButMadLad

          Do some of your own research on the original article.

          Vending machines were brought in to save money from sacking two people. Claimed saving of £13,000. However charging didn’t work so rather than go back to the original method of hot water from a tap using with tea bags provided they made the vending machines free. Well not free, as the vending company still needs to be paid for their expensive (and usually crap) tea and coffee. And to pile on the incompetence, drinks from the vending machines couldn’t be taken into meeting rooms, but the drinks provided by the sacked staff could.

          In a private company a kettle and a kitchenette with tea and coffee and milk can be provided. In a public sector office where they aren’t spending their own money (and so not eating into any profit in the supply of facilities) they will spend whatever they want, even to the extent that it would be cheaper to give money to the staff to spend at a local Costa Nero.

          • blarg1987

            I think you wwill find it is more to do with ideology, the idea being that outsourcing means no liabilities however you pay a premium fo it. I agree tea and coffe vending machines are a waste of money if you take all the costs into account, the point I am making is that the TPA criticises the public sector saying it wastes to much money etc, however when it does a comparison it does not take the FULL costs into account, so for example it advocates outsourcing of more services, however many outsourcing contracts have many loopholes as to do like for likee would increase the tender price, yet the TPA remains very quiet on such issues……….

          • Thats_news

            The drinks fiasco was a result of outsourcing, but badly thought through.

          • Remittance Man

            badly thought through

            An epitaph suitable for 90% of government initiatives.

          • SadButMadLad

            I see your point and agree with you

    • Remittance Man

      Are you trying to tell me that the rest of my cuppa costs more than 24 times the tea bag?

      • blarg1987

        Its more then that, how did the TPA work out they could get all the tea bags for £200, was it going to a direct wholesaler who normally does bulk purchases cheap and was it the cheapest tea bag brand possible? Again coffee can have a large variety of prices atttached to it depending on the brand people use and want. Milk relatively straight forward but also you can get deals, the same with sugar.
        The big costs are going to be heating the water up, as the energy involved heatign a large body of water is quite expensive plus keeoing it at that temperature all day.

        Plus of course the private company has to make money but the TPA never ask these companies how much money are they making off the tax payer of public sector contracts potentially something we should know and something maybe they should lobby for harder?

    • Declan

      It’s not a like-for-like comparison because that is not the point. The point is that there is a cheaper way of doing the same thing in the same place. People on benefits are asked to freeze scraps of food to make it go further so why can’t the people who offer that advice work along the same principals?

  • BobBob

    “When the Coalition Government came into power, they implemented a two-year public sector pay freeze. That clearly hasn’t happened” erm, yes it did – I’m a public sector worker, I have had no pay rise in four years, I had a pay cut of approx. £1000 this year, my pension has been devalued and I have to work until I am 68. Probably will be dead before then. Still guess I deserve it and a whole lot more……..

    • Keep an eye out

      You deserve whatever is normal and not a premium on the private sector.

      • BobBob

        Yes, we sure do, cannot argue with that. However, the original statement I refer to is one-sided; it implies all civil servants are still sitting there with fat salaries and gold plated pensions when in reality, there have been considerable and ongoing changes in some departments.

      • blarg1987

        But how do you define normal? Being the minimum wage or a like for like comparison of simular jobs to the private sector?

  • blarg1987

    After further reading did the TPA actually investigate further into details, for example the cost of £22 per light bulb that usually costs 65p, now was this through a private company and not in house i which case does it not speak of hippocracy when you say their needs to be more outsourcing, also bearing in mind many contracts that are 100% water tight usually end up costing the tax payer more and so do not deliver savings.

    Also did you actually get experts in the field in question when looking at all these things, such as the screw incident? Anyone can say I can get a screw for x pounds cheaper however if it is a screw to a specific requirement i.e. nucelar submarine or high altitude aircraft it aint going to be your usual screwfix or pound shop item.

    This things have to be taken into account which this research seems to fail to do so. Also everyone makes mistakes inckuding the private sector and sometimes at a very costly amount, yes it is right to true and reduce them as much as possible but some are always bound to happen.

    • John McEvoy

      “Also everyone makes mistakes…”
      Especially blarg1987, with around 10 displays of illiteracy in one post, including two howlers involving the same word – ‘hippercritical and ‘hippocracy’.

      • blarg1987

        If we criticised individuals on their communication rather then the information they are trying to share would we be listening to Steven Hawking?

        • disqus_KdiRmsUO4U

          Dont listen to Hawking in any event.

          His ideas belong on the Isle of Phanstasmagiria.

          Which is located on the 977th squillionth universe to be found not far from sphagetti junction.
          Not the one on the M6 but the other one..

          • blarg1987

            Think you find theoretical physics plays a very important role in things we take for granted, such as the computer you are writing your comment on, all using computer coding written by programmers based on mathmatics created by inderviduals who at the time thought of theoretical maths :) .

          • tinkerbelle

            The theoretical/practical physics that brought about the developments you mention were by and large developed during the late 19th century.

            Certain difficulties later became apparent that have been ‘explained’ by such things as wave/particle duality, cats that may or may not be present depending on the perspective of the observer. and warped space time.

            Cosmologists not to be outdone then decided that if they could introduce outlandish concepts into equations and produce solutions then the truth has been approached and multiverses exist.

            I am currently developing an equation to prove that round pegs fit into square holes precisely.

      • Thats_news

        Yes, because as anyone of quality knows we can ignore the opinion of someone if they make an error. Also, if they have nothing of value to contribute, rather like you, John McEvoy.

    • SadButMadLad

      You have a point about the £22 light bulb not being a full picture. It probably included the maintenance company’s costs including sending a person round in a van with parking charges and petrol on top of the labour cost for a 5 minute job.

      But that’s beside the point when the civil service is so crap at allowing such contracts to exist in the first place. But then the civil service isn’t spending their own money. Anyone who signed such a contract needs to be sacked as useless and incompetent. Yes, everyone makes mistakes. In a private company they make a loss or go bust. In the public sector nothing happens.

      • blarg1987

        So let’s say your a civil servant you are told most things are to be outsourced and you draw up the contract. The draft indicates that outsourcing will actually cost more and so would make you fall out of favour with your political masters potentialy costing you your job. You are then told to retraft he contract to make it more appealin g to private companies and if you don’t your job may be classed as redundant. With a family to feed and mortgage to pay what are you likely to do under those circumstances?

  • Haerton

    Just how much do the so-called researchers, campaigners, directors etc. Of the TPA get paid for producing this rubbish? I think we should be told. Surely there are more useful endeavours. Or are you just not bright enough to get decent jobs in the public sector..?

  • johnjames

    The biggest waste of tax payers money is indirectly paying landlords mortgages.Rent prices are through the roof and multiple property owners are raking it in from the tax payer funded housing benefit system.

  • Keith Appleyard

    I was reading the latest National Audit Office report on the Legacy Systems in Public Service Delivery. I think the NAO missed the point?
    I picked on 3 instances, and instead of the absolute running cost which NAO was focussing on, I looked at the running costs per ‘customer transaction’. In fact the most expensive system per transaction was the one that the NAO raved about because overall it was the cheapest to run by an order of magnitude (£10m vs £400m).
    * The Department for Work & Pensions’ (DWP) pension service. This assesses entitlement to state pension, pension credit and winter fuel allowance. In 2011-12, processed 5.2 million new claims or adjustments, cost £385 million to run and had 6,000 processing staff. = so that’s £74 per claim, or 866 claims per annum per member of
    * HM Revenue & Customs’ (HMRC) VAT collection service. In 2011-12, the service was used by 1.9 million customers, processed 7.7 million VAT submissions, had 5,900 staff and cost £430 million to
    run. = so that’s £55 per VAT submission, or 1305 submissions per annum per member of staff
    * The Office of Fair Trading’s (OFT) consumer credit licensing service. This supports around 25,000 applications, renewal notifications and licence surrenders each year. The credit licensing service cost £10 million to run in 2011-12, with 110 processing, compliance and enforcement staff. = so that’s £400 per transaction, or 227 transactions per annum per member of staff

    I’d like to see a target of no transaction costing more than say £25.

  • Muizi

    Has anyone asked that we are spending £34m each year to remove illegal migrants on commercial flights and 50 percent fail to leave uk and 40 percent wasted in non recovery?

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  • angelusx

    £2.9 billion – Amount spent needlessly by the Department for Business, Innovation & Skills and Department for Culture, Media & Sport, which should both be scrapped.

    How about giving some examples. I presume you do recognise the value of our creative industries, said to be worth more than £36 billion a year, employing 1.5 million people and accounting for around £1 in every £10 of the UK’s exports. As for not supporting business innovation and skills, that sounds plain daft,

  • David Mortimer

    Poverty will become ever more entrenched in Britain if the government
    does not maintain social spending to protect the most vulnerable, the
    Organisation of Economic and Social Development has warned. The 1% cap on benefits will make more people hungry & homeless out of the 60% of people who have to work & claim benefits in the UK.

  • Maggie Allen

    Disgusting amounts of tax money for what????? When the folk cannot afford to eat . Shame on this Zionist satanic controlled mafia government.