Report queries £5bn Gershon efficiency savings

A report by the spending watchdog has cast doubt on government claims to have saved almost £5bn through efficiency programmes.

As part of the Gershon efficiency report, the government wants Whitehall departments to save £21.5bn by 2008 through redundancies and changes to working practices.

The National Audit Office (NAO) said some good progress had been made, but that it is concerned about how some of the savings have been calculated.

The government said its programme is “firmly on track”, but admitted measuring efficiency correctly is “a challenge”.

The Gershon report said spending could be cut by improving procurement practices, using modern technology, cutting bureaucracy and moving staff away from back-office functions.

In particular, the NAO was concerned that 68 of the 300 projects that will deliver the savings did not have baseline figures, making it hard to judge how much was being saved.

It was also concerned that 15% of the overall savings were meant to be delivered by IT projects, despite the government’s less than perfect record on delivering IT projects on time and on budget.

It also pointed out that most projects are not taking account of the cost of the efficiency plans themselves when calculating the savings made.

A new CBI survey suggests the majority of British firms think the government will miss its efficiency target.

Findings from the survey – which  was sent to 1,823 companies and received 307 responses – show that more than half of the respondents said they were “not at all confident” and 34% were “not very confident” that the target would be reached.


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