Government on track to save £8bn this year

Interim results show that government departments have saved £3.1 billion so far this financial year and are expected to save more than £8 billion by the year end.

Minister for the Cabinet Office Francis Maude said: “Our fundamental programme of reform is changing the way Whitehall operates and driving efficiency savings to make every taxpayer pound count.

“Thanks to the hard work of hundreds of civil servants in the Efficiency and Reform Group and beyond we have helped departments save £3.1 billion so far this financial year, putting us on track to save £8 billion by year end.

“We have said we want to be saving £20 billion a year by 2015 and savings of this magnitude cannot come by trimming budgets here and there. That’s why we are working to transform Whitehall into a leaner, more efficient machine that manages its finances like the best-run businesses.

“We are taking the tough decisions required to ensure that Britain can compete in a global race. We cannot go back to the old days of waste and profligacy.”

The interim departmental results of £3.1 billion announced today build on the £5.5 billion of savings in 2011/12 and the £3.75 billion saved during 2010/11. They include:

• £680 million through the moratorium on consultancy and contingent labour spend and on extending existing consultancy contracts;
• £170 million from reductions in the in-year cost of the government’s property estate, by exiting unnecessary properties, and questioning each and every lease break before they get extended;
• £295 million by using government’s bulk-buying power and pooling spend on goods and services used by different departments; and
• £900 million from salary cost, achieved by reducing the size of the Civil Service through stronger controls on non-essential recruitment.