Progress with VFM savings and lessons for cost reduction programmes

Download or read book Progress with VFM savings and lessons for cost reduction programmes written by Great Britain: Parliament: House of Commons: Committee of Public Accounts and published by The Stationery Office. This book was released on 2010-11-04 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: The £35 billion value for money target set as part of the 2007 Comprehensive Spending Review required public bodies to make sustainable cash-releasing savings, whilst maintaining the delivery of departmental priorities. The £35 billion target represented savings of 3 per cent a year for each department's expenditure at the start of the period. By March 2010, two years into the three-year programme, departments and local authorities had reported only £15 billion of savings, less than half of the total needed to reach the £35 billion target. Departments could not even measure adequately what savings they had made, and the Treasury failed to create a framework for reliable reporting. The current financial environment is fundamentally different, with substantial cash reductions required over the next four years by most departments. The results from the CSR07 programme raises concerns as to whether departments are ready to implement effectively a programme of value for money savings. There is a serious risk that departments will rely solely on cutting front-line services to reduce costs, without adequately exploring the potential to reduce costs through other value for money improvements. Whilst day to day responsibility for delivering savings will be for individual departments, the Committee expects to see the Treasury provide leadership, taking full responsibility for delivery across government and intervening where performance does not meet expectations.