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 theBumper 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 procurement and 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 latest Bumper 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.”