The Efficiency and Reform Group set up in the Cabinet Office four months ago to ensure that departments across Whitehall adopted a new and ambitious approach to saving money, has announced savings of hundreds of millions of pounds.
The Group oversees information and communications technology spend, procurement, marketing and consultancy spend, and Civil Service expenses and recruitment. Much of its work has never been tried by Government before, such as renegotiating contracts with major suppliers across government to reduce costs, and a freeze on all new advertising and marketing spend.
Around £402 million has been saved in this financial year following a review of the Government’s largest projects, although a large proportion of this sum has come from abolishing the ID cards programme. Over 300 ICT smaller projects have been reviewed and work is underway with departments to stop or de-scope contracts worth £1billion.
A moratorium has been introduced to stop departments buying new space or renewing existing leases. So far 20 buildings have already been vacated, saving £18 million in rent this year.
Following the introduction of the recruitment freeze, there has been an estimated 75% reduction in the recruitment of permanent staff compared to the same period last year. Action has been taken to reduce the use of temporary, agency and interim staff. Latest figures show the total number has already fallen by an estimated 30%.
£27 million has been saved on websites, advertising and marketing, compared to last year in the period from June to August, following the introduction of a freeze on all new non-essential marketing and advertising spend.
Total spend on consultancy and procurement across Whitehall has been reduced by more than £100 million compared to the same period last year following the introduction of new rules stating that any spend over £20,000 needs Ministerial and Permanent Secretary approval. Work has progressed quickly to renegotiate contracts with the Government’s key suppliers. When completed, this process is expected to deliver more than £800m in savings this year.