New Research: Departmental Losses hit £5.1 billion

New research from the TaxPayers' Alliance exposes the scale of inefficiency in Whitehall departments and demonstrates losses of £5.1 billion in 2013/14.

  • The Ministry of Defence incurred losses of £3.07 billion, including a loss of £4 million on inventory for Sea King helicopters no longer in use and £6 million on ear plugs found to be not fit for purpose
  • While some losses or payments will be from one public sector body to another, Government guidance suggests the losses "are items that ideally should not arise."
New research from the TaxPayers' Alliance has revealed how government departments wasted billions of pounds in just one year through avoidable errors, unnecessary procurement, and special payments in compensation or unexpected legal fees. 

The losses include:
  • A loss of £1.2 million because a school paid into the wrong account
  • £49 million for the exchange of Tamiflu stock
  • Vaccine write-offs that cost the Department of Health £255 million
  • A special payment of £16 million made by the Home Office due to legal costs relating to asylum support cases
It is important to note that some of these losses may have been to other public sector organisations. However, "losses and special payments are items that Parliament would not have contemplated when it agreed funds. By their nature they are items that ideally should not arise."

Key findings
  • Departmental losses and special payments in 2013/14 totalled a shocking £5.1 billion
  • The Department with the highest losses with £3.1 billion was the Ministry of Defence. This involved, among many others, losses on ear plugs, out of date inventory and unsuitable equipment
  • The Department for Work and Pensions lost some £569 million and the Department of Business, Innovation and Skills incurred losses of £469 million
  • Ministerial Departments ran up a bill of £157 million in "Special Payments" as a result of unforeseen but often avoidable events
  • The Home Office led the way with £50 million in Special Payments
Jonathan Isaby, Chief Executive of the TaxPayers' Alliance, said:

"While in some cases closing a programme or getting out of a rental agreement early may make long-term sense, many of these losses are simply ludicrous and will seriously damage the trust taxpayers have in Whitehall civil servants. It is clear there remains far too much waste in the system. With an ever-growing debt burden, we must make government more efficient and ensure taxpayers are getting real value for money. "


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