Government departments have all but exhausted scope for reductions in office space and they need to start sharing with other public sector bodies.

The National Audit Office in its report reveals that the Government is aiming to achieve an average space utilization of 10 m2 per person. If the target is achieved, this would release about 2.1 million m2 of space, which is more than all of the office space at Canary Wharf. Annual running costs would be reduced by £830 million.

However, this will require complex and substantial reconfiguration of the estate and depend on moving out of surplus office space in a difficult market. The NAO estimates around £650 million of this reduction can be achieved by 2020 by not renewing leases.

The NAO is critical of the Government Property Unit which was set up to strengthen central control of the estate. The Unit was slow to change the way the Government manages its estate and it failed to gain support for its plans for centralisation. As a result decisions on which properties to retain and which to dispose of are based on what is easy to exit rather than on what best meets government’s needs.

The Government is now exploring how property can help wider civil service reform, but the NAO has yet to see this translate into concrete plans.

Amyas Morse, head of the National Audit Office, said: “The cost of the total stock of government office property has gone down markedly in recent years. Further substantial progress will require a step change in the way departments work together, involving an end to their managing their estates in isolation. The Government Property Unit needs to work to overcome the barriers preventing departments sharing office space, and help government find ways of using the estate to facilitate wider improvements in how the civil service works.”