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Cost reduction and affordability

All public services have to be delivered with lower budgets and show the public that they are affordable. Where government is reducing costs it could benefit from the lessons learnt and good practice identified in the NAO's public sector work. The biggest savings are being made through complete transformation of service delivery, including digital delivery of services. Substantial savings can also be made through specific aspects of financial management, such as reducing fraud and error and better management of assets and liabilities.

There are also risks to making savings, including to long-term innovation and investment. Government needs to ensure the long-term financial and service sustainability of local services, it must maintain strong oversight of contractors, and it should ensure environmental sustainability. Performance measurement is also key to providing the information needed to make crucial decisions.

Key NAO publications:

Central government staff costs (Jun 2015)
Forecasting in government to achieve value for money (Jan 2014)
Evaluation in Government (Dec 2013)
Financial management in government (Jun 2013)

Managing the BBC’s workforce

The BBC’s approach to managing its workforce shows definite progress. It will need to monitor workforce changes carefully to build on the recent progress it has made.

Sector(s): Arts, media and sport

Performance Improvement area(s): Cost reduction and affordability

Department(s): Department for Digital, Culture Media and Sport

Published:
26 Apr 2017

Progress on the government estate strategy

Departments have continued to reduce their estates and government is now getting better value for money. The Government Property Unit, however, has not yet made much progress towards its more challenging objective of creating an integrated estate.

Sector(s): Government, efficiency and transparency

Performance Improvement area(s): Cost reduction and affordability, Financial management, Strategic centre of government

Department(s): Cabinet Office

Published:
25 Apr 2017

The quality of service for personal taxpayers

HMRC aimed to move more customers online thereby reducing staff costs but significant numbers of staff were let go before technical improvements were completed leading to a collapse in service quality in 2015. Services have since improved.

Sector(s): Tax

Performance Improvement area(s): Cost reduction and affordability, Customer management, Digital service delivery, Transforming public services

Department(s): HM Revenue and Customs

Published:
25 May 2016

Shared service centres

Government’s programme to transfer back-office functions to two shared service centres has made savings but has not achieved value for money to date.

Sector(s): Government, efficiency and transparency

Performance Improvement area(s): Cost reduction and affordability, Strategic centre of government

Department(s): Cabinet Office

Published:
20 May 2016

Managing the welfare cap

The welfare cap is encouraging a greater understanding of spending on some benefits and tax credits across government, but it is important that processes for managing the cap are reliable.

Sector(s): Central Finance and Treasury, Government, efficiency and transparency, Welfare, Pensions and Employment

Performance Improvement area(s): Cost reduction and affordability, Financial management, Oversight of service delivery

Department(s): Department for Work and Pensions

Published:
27 Apr 2016

Use of consultants and temporary staff

Annual spending on consultants and temporary staff has reduced by £1.5 billion since 2010 when strict spending controls were introduced. However, annual spend is now increasing once more and is between £400 million and £600 million higher than in 2011-12.

Sector(s): Government, efficiency and transparency

Performance Improvement area(s): Cost reduction and affordability, Strategic centre of government

Department(s): Cabinet Office

Published:
13 Jan 2016

Competitive and demand-led grants: good practice guide

The Cabinet Office estimates that government commits around £130 billion to grants each year – nearly 20% of all government spend. Grants are an important delivery mechanism for policy across government, not just centrally but also in agencies, local authorities and other bodies across the public sector.

Sector(s): Government, efficiency and transparency

Performance Improvement area(s): Cost reduction and affordability, Operational and programme delivery, Strategic centre of government

Published:
26 Nov 2015

The art of spending public money wisely

An interactive summary of the NAO’s presentations at Civil Service Live events, 2015, on four pervasive issues blocking public service improvement.

Sector(s): Government, efficiency and transparency

Performance Improvement area(s): Cost reduction and affordability, Financial and service sustainability, Managing major projects, Transforming public services

Department(s): HM Treasury

Published:
7 Oct 2015

Central government staff costs

Staff numbers and costs have reduced significantly in the last five years. Not enough planning, however, has gone into making sure that the reductions are sustainable.

Sector(s): Central Finance and Treasury, Government, efficiency and transparency

Performance Improvement area(s): Cost reduction and affordability, Strategic centre of government

Published:
5 Jun 2015