Government Criticised For “illogical” Efficiency Data


Treasury committee asks hard questions about whether government efficiency claims are accurate and the methods used to calculate them

In a tone reminiscent of a Star Trek’s Mr Spock, a Treasury panel has branded the government’s approach to collecting evidence to evaluate the success of its recent efficiency drive, as “illogical” and lacking robustness.

In a report released this week, Evaluating the Efficiency Programme, the Treasury Sub-Committee pulled the government up on its approach to collecting data about the various efficiency programmes resulting from the Gershon Review. The Gershon Review was published in 2003 and resulted in The Gershon efficiency programme (GEP), which “considered spending between 2004-05 and 2007-08”  and according to Treasury estimates “delivered £26.5 billion of efficiencies against a target of £21.5 billion”.

But in its latest report, the Treasury Sub-Committee has questioned efficiency figures put forward by the Treasury including the £26.5 allocated to the GEP. In particular, the Treasury committee claimed that the lack of an audit into the report savings by the National Audit Office meant that the numbers were not as reliable as they could be.

“The Report [sic] that the NAO did not audit the final Gershon efficiency savings and is concerned that this may have led to a lack of confidence in the Government’s reported savings. At a time when the public sector will be pressed to make further efficiencies, it is vital that any savings made are properly recognised and quantified, the Report says. It calls on the Government to continue to work with the NAO to ensure that future efficiencies are accurately measured,” the Treasury committee statement concluded.

The Treasury committee also voiced concerns about how the government approached data collection to accurately measure how successful the efficiency drives had been.

“It also appears to the Committee that, time and time again, the establishment of data collection systems needed to validate savings is being initiated only after efficiency programmes are launched. This order is illogical. If Government does not evaluate the costs and savings of major efficiency programmes, then it is unclear whether such programmes represent real value for money. The Report therefore calls on the Government to establish robust data collection processes at the start of future efficiency programmes,” the report stated.

Treasury sub-Committee chairman, Michael Fallon MP, said that now more than ever it was vital for the government to be as transparent as possible about efficiency and cost cutting. “Now that the level public debt has reached such gargantuan proportions, it is important that the Government takes steps, not only to improve efficiency in the public sector, but also to account more clearly and accurately for the savings it is making,” he said. “In the face of ever more job losses in the private sector, the public sector must consider more radical solutions to reducing its burden on the taxpayer.”Following on the from the Gershon Review and subsequent efficiency drive, the government has initiated another programme of cost-cutting known as the Operational Efficiency Programme (OEP), which has been underway for a year and claims that the UK’s public sector could trim around 20 percent of its current £16bn annual spend on IT by 2014.

Savings made by government through the use of IT were also touted by the former Minister for Digital Engagement Tom Watson who stepped down from the Cabinet in the reshuffle that coincided with the recent expenses scandal.

In a statement released in May to mark the publication of the Transformational Government Annual Report, Watson outlined the billions of pounds saved by using IT to improve public services over the last year.

“This Government has achieved so much by using technology to drive the reform of public services, with increased efficiency and more freedom for people to shape services around their lives rather than government convenience,” he said. “We have already achieved £26.5 billion of efficiency savings – and will save a further £35 billion by 2011.”

While the efficiency drive is concentrating on using technology to deliver savings, public sector IT managers have argued that more efficiency could best be provided by a focused investment, calling for a £1 billion programme, which it promises would generate cash savings of £2 billion in three years, and acthieve a 12 percent reduction in carbon emissions.