Every so often, as Minister for the Cabinet Office, I make a significant announcement which necessitates a day of radio and TV interviews and much coverage in the press.
Monday was just such a day and, announcing that last financial year we’ve saved the taxpayer £10bn by driving out inefficiency and waste, exceeding our own target by 25 per cent, was a great way to start the week. Let me put that figure into context. £10bn is the equivalent of almost £600 per working household across Britain; enough to fund three million primary school places or build 500 new secondary schools.
Apart from looking good on the country’s balance sheet, these savings are an important part of reducing our budget deficit and returning the UK to fiscal sustainability – enabling us to compete globally. Again, to put this into context, in 2010 we inherited the largest budget deficit in the UK’s post-war history – we were paying £120m a day just to service the interest on the country’s debt.
The Government was having to borrow £1 in every £4 just to keep the lights on, the pensions paid, teachers in schools, doctors and nurses in hospitals.
Together with the Chief Secretary to the Treasury, I chair the Efficiency and Reform Group (ERG) which was set up in the early days of the Coalition Government to, in a nutshell, drive savings throughout the Civil Service to make every taxpayer pound count.
It’s all about making government as efficient as possible – adopting practices considered essential by successful businesses.
Savings have been made across four key areas of the Cabinet Office’s work:
Linking together departments to buy goods and services and enforcing sensible controls on recruitment and use of consultants.
Improving online services, and raising money through selling empty buildings and exiting expensive rentals in sought-after locations.
Reviewing and reshaping large-scale projects and stripping out inefficiencies.
Reducing the size of the Civil Service and reforming Civil Service pensions.
We’ve saved, for example, £1bn by centralising the procurement of common goods and services; £1.9bn by limiting expenditure on marketing, advertising, consultants and temps and £2.2bn by reducing the size of the Civil Service.
The ERG supported Government departments in delivering savings of £3.75bn in 2010/11, £5.5bn in 2011/12 and now £10bn in 2012/13 – that’s quite something. It’s satisfying to look at those statistics and to know that hard work and dedication within the Cabinet Office and across all Government departments has had such a real and significant impact on our country’s finances. We are focused on getting more for less – achieving significant savings without impacting frontline services and we’ll press on – there’s a lot more to do!