The National Audit Office (NAO) warns that Whitehall’s efforts to streamline their services and save taxpayers’ money are not working.
£90 million of savings have been made to date by outsourcing and transforming back office functions but the total cost of investment of the programme has been £94 million. Thus far, the efficiency reforms have had a net cost of £4 million.
The plan is for 2 independent shared services centres to provide back-office functions for up to 14 departments and their quangos.
But the reform programme has been severely delayed, and it was expected that savings would total £128m a year.
Sharing services should deliver 20 per cent savings on annual running costs. And the Cabinet Office currently estimates that savings will total £484m by 2023-24 and cost of £159m. But given the current problems it seems unlikely that this will be realised.
Indeed the NAO warn that delays in rolling out the programme may have put the current plan and system designs out of date.
Additionally, just 2 organisations, out of the 26 that plan to adopt the single operating platforms, have done so.
These would have saved a further £172m-272/year. But no organisations met their target date for moving to the new platforms and the average delay is 14 months.
The NAO’s report recommends that the Cabinet Office take a more proactive role if such programmes are to be a success in the future.
Their verdict is damning:
"The Cabinet Office’s failure to manage risks has resulted in the programme failing to achieve the significant savings and other benefits set out in the 2012 strategy. Therefore, the programme has not achieved value for money to date. The Cabinet Office has begun to find its role in leading the programme. However, the delays have meant that technology has moved on significantly, and new options should now be considered and evaluated as part of revising the programme plan. The future shared service programme will only achieve value for money if the Cabinet Office shows clear leadership, sets realistic expectations and manages risks, and government accepts that change requires collaborative and flexible behaviours from all departments involved."