Whitehall departments are facing another round of back office cutbacks following the chancellor’s announcement of new targets for efficiency savings.
At Treasury questions yesterday, Gordon Brown said departments would be ordered to make administrative savings of at least 2.5% a year from 2007-2010
These will be in addition to the £21bn savings being implemented as a result of the 2004 Gershon efficiency review.
“Administrative budgets that have already been frozen will now be cut not only in real terms but in cash terms, releasing extra resources for frontline services,” Brown said. “These administrative savings make possible improvements in service.”
The Treasury’s spending framework document said government departments had, by the end of March, reported annual savings of £9.8bn and half of the 84,000 jobs targeted in the Gershon review had been cut.
Brown also announced that HM Revenue & Customs chairman, Sir David Varney, will examine how further administrative savings can be delivered.
