Headlines: January 17th, 2012

The government has saved £100m in the first nine months of the financial year by introducing strict property controls and getting a better grip on the property estate.

The savings are from the national property controls, which include a requirement for Cabinet Office approval for all new leases and property acquisitions, and surplus buildings being examined for sub-letting or sale. Space is also used more effectively – for example, Cabinet Office staff led the way by moving into the Treasury building earlier this year, which was the first major example of co-location in Whitehall.

The savings come as the Cabinet Office publishes new property data as part of the Government’s transparency drive. It details every location and shows the sheer breadth of the central civil estate. It includes information on the number and size of properties as well as detailed usage statistics such as space, cost and water and energy consumption per employee.

The data shows that the estate covers an area almost six times the City of London. This does not include the wider public sector estate or parts of Central Government’s operational estate – such as NHS buildings or schools.
The cost of property per employee is similar to the private sector – £4,454 per employee in the public sector, compared to £4,525 in the private sector. Public sector employees have 16% more space per employee than in the private sector – at 13 square metres. However space per employee fluctuates widely across the estate – suggesting that many buildings could be run more efficiently.

The Cabinet Office, working with other government departments, examines vacant space to ensure that where possible it is either sub-let or sold, generating savings for the taxpayer. Work is also underway to examine how public sector employees can make better use of the space they do need – for example by encouraging more innovative, flexible and modern working practices. These measures will reduce not only the costs per employee but also the Government’s carbon footprint.

Bernard Baker – Director, Public Sector, SAS UK said: “For the majority of us, property is either our largest expense or asset, so it makes sense for the government to look closely at the size of its own estate. With nearly 14,000 property holdings, including 552 vacant, it has the potential to make significant fiscal savings over the course of the next parliament through sub-letting, sales and reduced facilities management costs.

He added: “However, while the Government’s announcement is promising for the public purse, it needs to be careful to avoid a car-boot sale approach, so that short-term gain doesn’t create significant expense in the future. If it doesn’t look closely at the large volumes of information it holds on its estate, and analyse the data to ensure that it’s making the right decisions about the assets it sells and those it sub-lets, it could be in the position of having to buy back previously sold property in years to come.”