Recommendations & Conclusions
22 items
2
Recommendation
Twenty-Eighth Report - Efficiency in go…
Accepted
Past experience shows that attempts to improve efficiency can inadvertently reduce the quality of services or increase costs elsewhere – what this committee has called cost shunting. Efficiency plans without a clear idea of the implications for service users have led to problems in the past. For example, when the …
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Past experience shows that attempts to improve efficiency can inadvertently reduce the quality of services or increase costs elsewhere – what this committee has called cost shunting. Efficiency plans without a clear idea of the implications for service users have led to problems in the past. For example, when the Ministry of Justice attempted to reduce demand for legal aid, there was a large increase in litigants in person which created extra costs elsewhere in the justice system. The collection of data around user behaviour is important when planning, implementing and running efficiency programmes in order to avoid future remedial changes with additional costs attached. However, as the Committee highlighted in its 2019 report Challenges in using data across government, government has not treated data as a valuable asset. Recommendation: HM Treasury should ensure that, in their efficiency plans, departments consider what the potential impact might be on service users, and that data around user behaviour and sentiment is tracked as programmes are implemented.
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Government response AI summary
The government agrees with the recommendation, stating it has already been implemented through the SR21 Priority Outcomes and Metrics, which include tracking user sentiment. HM Treasury guidance and recent efficiency exercises also require departments to consider impacts on service users and demonstrate deliverable proposals.
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HM Treasury
3
Recommendation
Twenty-Eighth Report - Efficiency in go…
Accepted
Previous efficiency programmes have over-promised and under-delivered. ‘Optimism bias’ is a long-standing problem within government where project plans are impractical and unrealistic, and do not always achieve the expected objectives. We have seen this across a range of programmes, such as Shared Service Centres and, more recently, the Defence Equipment …
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Previous efficiency programmes have over-promised and under-delivered. ‘Optimism bias’ is a long-standing problem within government where project plans are impractical and unrealistic, and do not always achieve the expected objectives. We have seen this across a range of programmes, such as Shared Service Centres and, more recently, the Defence Equipment Plan 2020–2030. These problems occur due to poor data on costs and performance, but also because departments and central government do not consistently challenge existing plans. The Treasury and Cabinet Office told us that “test-and-learn pilots” gather programme data to give departments 6 Efficiency in government the flexibility to react when programmes do not meet their assumptions. However, government needs to be more agile in responding to these results: currently too few schemes are halting early enough after showing signs of poor progress. These issues could re-emerge if government prematurely over commits to efficiencies based on changes that have occurred during the pandemic which may not endure, such as reducing the government estate as a result of staff working from home. Recommendation: HM Treasury need to ensure plans are subject to adequate challenge, testing the realism of departments’ expected savings, and considering the use of pilots where appropriate.
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Government response AI summary
The government agrees, stating the recommendation is already implemented. HM Treasury uses various mechanisms, including the Chief Secretary's engagement during SR21, spending control processes, and Outcome Delivery Plans, to challenge and test the realism of departmental savings and efficiency proposals.
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HM Treasury
4
Recommendation
Twenty-Eighth Report - Efficiency in go…
Accepted
Skills shortages in the civil service could compromise departments’ ability to achieve efficiency savings. A lack of skills and leadership capability has caused delays, inefficiencies, and increased costs in several previous government projects. For example, the InterCity West Coast franchise competition saw a lack of leadership and expertise contribute to …
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Skills shortages in the civil service could compromise departments’ ability to achieve efficiency savings. A lack of skills and leadership capability has caused delays, inefficiencies, and increased costs in several previous government projects. For example, the InterCity West Coast franchise competition saw a lack of leadership and expertise contribute to its collapse, and the Common Agricultural Policy Delivery Programme suffered from a high turnover of senior leaders. Increasing the capability to conduct successful efficiency programmes may require government to ‘spend to save’, putting upfront investment in place to increase departmental capability and capacity. There is also a risk that multiple efficiency programmes rely on the same pool of specialists within government functions, to the extent that the functions do not have the capacity to meet the demand. Increased government spending on consultants as a result of EU exit and COVID-19 may well have been less efficient than building capability within the civil service. We welcome that the Cabinet Office has begun to reduce spending on consultancy and intends to build capabilities within government, as set out in its Declaration on Government Reform. Recommendations: HM Treasury needs to work with departments to understand the skills and capability required to deliver plans successfully, identifying any specialist and technical skills needed. The Cabinet Office should ensure, through its workforce planning, that there are enough resources and skills available to teams to deliver efficiency programmes and must write to us in six months on its progress in implementing the key measures within the Declaration on Government Reform.
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Government response AI summary
The government agreed with the recommendation, outlining several actions to improve civil service skills and capability, including allocating £26 million to a Leadership College, improving functional skills training with specific targets, creating a Government Consulting Hub, launching a Finance Career Framework, improving spending team skills, …
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HM Treasury
5
Recommendation
Twenty-Eighth Report - Efficiency in go…
Accepted
Departments often struggle to track benefits as closely as they track costs. The Treasury holds departments to account much more vigorously for their programme expenditure than the benefits they deliver. In turn, departments are often much better at estimating, and tracking, costs than they are at tracking benefits. This can …
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Departments often struggle to track benefits as closely as they track costs. The Treasury holds departments to account much more vigorously for their programme expenditure than the benefits they deliver. In turn, departments are often much better at estimating, and tracking, costs than they are at tracking benefits. This can lead to cost shunting, where an apparent cost saving in one area has an unintended negative consequence elsewhere. The timely sharing of data between departments is essential in tracking the effects of efficiency programmes across government. However, the quality and availability of data continues to be an issue. For efficiency programmes to be successful, an effective performance management system needs to be in place. This will allow the reporting of progress against milestones and increase the collection of data relating to both costs and benefits. The Cabinet Office expects that use of the new Outcome Delivery Plans, which mandate the publication by departments of what is expected from programmes, will improve transparency and accountability. However, this has only recently been implemented and is still unproven. Efficiency in government 7 Recommendation: The Cabinet Office and Treasury should work together to ensure that the new system of departmental Outcome Delivery Plans is able to track the costs and benefits of efficiency plans for government as a whole.
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Government response AI summary
The government agrees and states the recommendation is already implemented through Outcome Delivery Plans (ODPs), which track outcomes, costs, and benefits of efficiency plans. ODPs cover 2022-2025, with regular reporting and integration with existing financial monitoring and major projects assurance.
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HM Treasury
6
Recommendation
Twenty-Eighth Report - Efficiency in go…
Accepted
Government efficiency drives tend to be one-off events rather than being embedded as a continuous priority. The Treasury believes that well-defined, tight budgets provide departments with enough of a financial incentive to strive for efficiency continuously. But its emphasis on driving efficiency from departments primarily in the run up to …
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Government efficiency drives tend to be one-off events rather than being embedded as a continuous priority. The Treasury believes that well-defined, tight budgets provide departments with enough of a financial incentive to strive for efficiency continuously. But its emphasis on driving efficiency from departments primarily in the run up to Spending Reviews risks departments losing focus in between fiscal events and there is little evidence of a continuous improvement culture in government. Leadership behaviour that promotes a long-term view and encourages continuous improvement through a culture of openness and transparency that allows everyone to contribute must be properly incentivised. Recommendation: HM Treasury and the Cabinet Office should work jointly from the centre of government to consider how best to instil a culture of continuous improvement across government that lasts beyond this Spending Review process. 8 Efficiency in government 1 Planning efficiency savings
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Government response AI summary
The government accepted the recommendation, committing to closer collaboration with Government Functions, regularising links between functional experts and Treasury teams, and outlining plans for writing to the Committee in Summer 2022. It also highlighted the Declaration on Government Reform and its implementation to instil a …
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HM Treasury
1
Conclusion
Twenty-Eighth Report - Efficiency in go…
Accepted
On the basis of a report by the Comptroller and Auditor General, we took evidence from HM Treasury (the Treasury) and the Cabinet Office on the government’s plans to increase its efficiency as part of the Spending Review.1
Government response AI summary
The government accepted an inferred recommendation about planning for crises and ensuring efficiency plans don't impede them. It highlighted existing flexibility, new Outcome Delivery Plan guidance for 2022-23, a new forecasting framework, revised AO assessment guidance, and committed to a fuller assessment of lessons learned …
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HM Treasury
7
Conclusion
Twenty-Eighth Report - Efficiency in go…
Not Addressed
In the past, we have seen how departments failing to consider the full effects of their plans to improve efficiency have led to increased costs elsewhere in government, or have led to reductions in service quality which were costly to fix.15 For example, the National Audit Office found that the …
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In the past, we have seen how departments failing to consider the full effects of their plans to improve efficiency have led to increased costs elsewhere in government, or have led to reductions in service quality which were costly to fix.15 For example, the National Audit Office found that the Ministry of Justice’s reforms to civil legal aid unexpectedly increased the number of ‘litigants in person’, which raised the cost of processing cases and led to more legal problems down the line, with estimated costs of £3 million per year to HM Courts & Tribunals Service (an agency of the Ministry) as well as direct costs to the Ministry of approximately £400,000.16 The National Audit Office has also reported on how reforms implemented by HM Revenue & Customs assumed customers would switch to online services, failing to account for what the users of its personal tax affairs service valued, and thereby causing a deterioration in performance measures that saw customer waiting times triple.17
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Government response AI summary
The government response addresses a different PAC recommendation regarding considering impact on service users and tracking data, rather than the committee's conclusion #7 which describes past failures in efficiency programmes due to lack of full impact consideration.
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HM Treasury
8
Conclusion
Twenty-Eighth Report - Efficiency in go…
Not Addressed
We asked the Treasury how it will ensure efficiency plans consider the risk of ‘cost shunting’, where money saved in one area increases costs in another area, and whether it would be asking departments to identify where knock-on impacts could occur. The Treasury said that the Spending Review process will …
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We asked the Treasury how it will ensure efficiency plans consider the risk of ‘cost shunting’, where money saved in one area increases costs in another area, and whether it would be asking departments to identify where knock-on impacts could occur. The Treasury said that the Spending Review process will encourage different parts of government to come together and will require departments to have good understanding of where investment will be required and where benefits will be seen.18 The Treasury also said that guidance helps establish potential impacts across government. It highlighted 11 Q 54 12 Q 54, Boardman Review of Government COVID-19 Procurement final report (publishing.service.gov.uk) 8 December 2020, page 2 13 Qq. 55, 57 14 Q 57 15 C&AG’s Report, para 11 & 15 16 C&AG’s Report, para 17 17 C&AG’s Report, para 14 18 Q 60 10 Efficiency in government the New Burdens Doctrine, which requires departments to set out any consequences of planned changes to local government in order to provide the resources needed, as an example.19 Additionally, we heard that the Treasury’s ‘Managing Public Money’ guidance sets out departmental Accounting Officers responsibility to constantly assess the impact of the delivery of savings, efficiencies and transformation programmes for the exchequer as a whole.20 We asked the Treasury whether these impact assessments should be made publicly available to the taxpayer, and whether it is confident that they are being done well enough. The Treasury agreed that they should be made visible to the taxpayer, but that it could not be certain impact assessments are done properly for every policy.21
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Government response AI summary
The government response addresses a different PAC recommendation regarding considering impact on service users and tracking data, rather than the committee's conclusion #8 which reports on questions asked and answers received about cost shunting.
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HM Treasury
9
Conclusion
Twenty-Eighth Report - Efficiency in go…
Not Addressed
We questioned the Treasury and the Cabinet Office on how departments are expected to estimate the impact of efficiency savings on service user behaviour, and how this is incorporated into plans for efficiency.22 The Treasury told us that it agreed with the National Audit Office’s recommendations that it should collectively …
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We questioned the Treasury and the Cabinet Office on how departments are expected to estimate the impact of efficiency savings on service user behaviour, and how this is incorporated into plans for efficiency.22 The Treasury told us that it agreed with the National Audit Office’s recommendations that it should collectively assess the effects, behavioural impact and knock-on consequences of reforms, but stressed that these judgments can be inherently difficult. The Treasury expects departments to provide an initial assessment of the effects on service users, whilst their assessment of the likely impact of efficiency programmes are subject to further stress testing, including by experts in data, major projects or property. The Treasury also said it plans to learn from similar attempts at reforms in the past, such as the automation of services. The Treasury said it was hopeful the ‘Public Value Framework’, recommended by the Barber review, will improve departments’ ability to assess the initial impacts of reforms.23 Optimism bias
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Government response AI summary
The government response addresses a different PAC recommendation about considering impact on service users and tracking data, rather than the committee's conclusion #9 which reports on an exchange about estimating impacts of efficiency savings on user behaviour.
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HM Treasury
10
Conclusion
Twenty-Eighth Report - Efficiency in go…
Accepted
‘Optimism bias’ refers to the tendency for project appraisers to be impractical and unrealistic, which can lead to a failure to deliver, delays, poor service quality or a need for later funding injections.24 The prevalence of optimism bias in government has been highlighted before. For example, the Shared Service centres …
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‘Optimism bias’ refers to the tendency for project appraisers to be impractical and unrealistic, which can lead to a failure to deliver, delays, poor service quality or a need for later funding injections.24 The prevalence of optimism bias in government has been highlighted before. For example, the Shared Service centres initiative fell far short of the planned savings and failed to achieve value for money and, more recently, we reported on the Ministry of Defence’s Equipment Plan for 2019–2029 including unrealistic expectations for £4.7 billion of efficiency savings, a figure for which it had no plans.25
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Government response AI summary
The government agreed with the committee's recommendation (quoted in the response) that HM Treasury needs to ensure plans are adequately challenged, testing realism and using pilots. It described implementing this by leading engagement to test departmental proposals, developing Outcome Delivery Plans, enhancing financial reporting, and …
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HM Treasury
11
Conclusion
Twenty-Eighth Report - Efficiency in go…
Not Addressed
We asked the Treasury and Cabinet Office what is being done to minimise optimism bias, particularly how they can ensure efficiency plans are subject to adequate challenge and properly evidenced.26 The Cabinet Office told us that government functions will help scrutinise efficiency plans, with experienced professionals able to assess project …
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We asked the Treasury and Cabinet Office what is being done to minimise optimism bias, particularly how they can ensure efficiency plans are subject to adequate challenge and properly evidenced.26 The Cabinet Office told us that government functions will help scrutinise efficiency plans, with experienced professionals able to assess project progress and provide challenge. Within the Major Projects Review Group, for example, the Treasury and Cabinet Office work weekly alongside the Infrastructure and Projects Authority (IPA) and functional experts to assess projects, which can help identify and minimise optimism bias as the business case develops.27 More generally, it told us the culture of accountability 19 Q 60 20 Q 61 21 Qq. 62–64 22 Q 65 23 Q65; C&AG’s Report, para 12 24 C&AG’s Report, para 18 25 Committee of Public Accounts, Tenth report of Session 2019–21, Defence capability and Equipment Plan, HC 247, conclusion 6; C&AG’s report, para 25, Figure 5. 26 Q 66 27 Q 66 Efficiency in government 11 within government plays an important role in challenging optimism bias as it incentivises programme leaders to be honest about whether or not they think they can deliver with the resources planned. The Cabinet Office said continuing to test plans for their realism following their implementation is also important, as is learning from past experience.28
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Government response AI summary
The government response addresses a different PAC recommendation about ensuring efficiency plans are adequately challenged and realistic, rather than the committee's conclusion #11 which reports on an exchange about minimising optimism bias.
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HM Treasury
12
Conclusion
Twenty-Eighth Report - Efficiency in go…
Accepted
The Treasury told us that it is trying to prevent poor data leading to optimism bias by improving the raw financial data that government captures. It gave the new Online System for Central Reporting and Accounting (OSCAR 2) as an example of how government is capturing new and important datasets. …
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The Treasury told us that it is trying to prevent poor data leading to optimism bias by improving the raw financial data that government captures. It gave the new Online System for Central Reporting and Accounting (OSCAR 2) as an example of how government is capturing new and important datasets. The Treasury described how it is working with the government functions to collect benchmarking data, which can be used to sense check information. The Treasury noted how it would like to see more improvements to benchmarking data and more analytical insight driven by the functions to help make improvements in government.29 When we asked the Treasury whether departments should start programmes if they knew the data was not good enough, it told us that departments can use predictions based on historic data, which can be refined using small test-and- learn pilots, and then scaled-up if the new data proves the initial assumptions.30
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Government response AI summary
The government agreed with the committee's recommendation (quoted in the response) that HM Treasury needs to ensure plans are adequately challenged, testing realism and using pilots. It outlined implementation through testing departmental savings proposals, developing Outcome Delivery Plans, enhancing financial reporting, and sharing best practices …
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HM Treasury
13
Conclusion
Twenty-Eighth Report - Efficiency in go…
We asked the Cabinet Office whether it had pushed back on any plans for reducing the size of government estates because they were over-optimistic. The Cabinet Office explained that the government’s plan to shrink the London property estate has not been progressing as quickly as it had wished due to …
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We asked the Cabinet Office whether it had pushed back on any plans for reducing the size of government estates because they were over-optimistic. The Cabinet Office explained that the government’s plan to shrink the London property estate has not been progressing as quickly as it had wished due to expansion of departments in response to Brexit and COVID-19.31 The Cabinet Office said there are big opportunities for savings in London real estate but could not say to what extent these would be realised, as there is still uncertainty around the numbers of staff who may work from home or in offices across the United Kingdom.32 28 Q 67 29 Q 68 30 Q 69 31 Q 78 32 Q 80 12 Efficiency in government 2 Implementing efficiency plans Skills and capability
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HM Treasury
14
Recommendation
Twenty-Eighth Report - Efficiency in go…
Accepted
The Cabinet Office has overall responsibility for capability within the civil service and should ensure departments have the capability required to achieve planned efficiency programmes.33 Capability shortfalls have led to problems on numerous occasions, such as in the InterCity West Coast franchise competition in 2012, where a lack of expertise …
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The Cabinet Office has overall responsibility for capability within the civil service and should ensure departments have the capability required to achieve planned efficiency programmes.33 Capability shortfalls have led to problems on numerous occasions, such as in the InterCity West Coast franchise competition in 2012, where a lack of expertise contributed to its collapse, and the Common Agricultural Policy delivery programme, which suffered from a high turnover of senior leaders.34
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Government response AI summary
The government accepted the recommendation, outlining several initiatives like a new curriculum, Finance Career Framework, and capability-based pay for Senior Civil Service to build capability. The Cabinet Office committed to providing an update in May 2022.
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HM Treasury
15
Conclusion
Twenty-Eighth Report - Efficiency in go…
Not Addressed
We questioned the Cabinet Office on how it can ensure capability is in place across government to deliver departments’ efficiency programmes. The Cabinet Office told us that processes such as the Outcome Delivery Plans, where outcomes are matched against resources, helps them identify where skill shortages are present.35 The Cabinet …
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We questioned the Cabinet Office on how it can ensure capability is in place across government to deliver departments’ efficiency programmes. The Cabinet Office told us that processes such as the Outcome Delivery Plans, where outcomes are matched against resources, helps them identify where skill shortages are present.35 The Cabinet Office explained how its Declaration on Government Reform shows its commitment to build the capabilities within government; how it is particularly keen to increase the capability and capacity of digital and major project development skills within functions; and that it will continue investing in these areas.36 When we asked the Cabinet Office whether efficiency projects are often turned down as a result of insufficient capacity, it responded that it is more a case of conditional approvals—where projects move ahead if they show they can bring in the right staff or skills on time.
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Government response AI summary
The government response addresses a different PAC recommendation regarding HM Treasury and Cabinet Office working to understand and build capability, and report on progress of the Declaration on Government Reform, rather than the committee's conclusion #15 which reports on an exchange about capability delivery.
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HM Treasury
16
Conclusion
Twenty-Eighth Report - Efficiency in go…
Accepted
We asked the Cabinet Office how it can ensure that skills are situated in the right places across government. The Cabinet Office explained how the growth in cross-government functions has helped achieve this, as has the internal government job market, since it matches people with the right skills to the …
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We asked the Cabinet Office how it can ensure that skills are situated in the right places across government. The Cabinet Office explained how the growth in cross-government functions has helped achieve this, as has the internal government job market, since it matches people with the right skills to the right jobs.37 The Cabinet Office also explained how the Infrastructure and Projects Authority is beginning to use specialists who can find the right people for the job on behalf of departments, and that it plans to do the same for the Digital, Data and Technology profession.38
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Government response AI summary
The government agreed with the committee's recommendation (quoted in the response) regarding HM Treasury and Cabinet Office ensuring sufficient skills and capability. It outlined specific actions including establishing a Leadership College, improving functional skills training with targets, creating a Government Consulting Hub, developing the Finance …
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HM Treasury
17
Conclusion
Twenty-Eighth Report - Efficiency in go…
Accepted
We asked the Cabinet Office whether it intends to reduce departments’ spending on consultants, which has been high and increasing following Brexit and COVID-19. The Cabinet Office told us it has a strong programme to try and cut the external spend, and that departments should only use external staff when …
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We asked the Cabinet Office whether it intends to reduce departments’ spending on consultants, which has been high and increasing following Brexit and COVID-19. The Cabinet Office told us it has a strong programme to try and cut the external spend, and that departments should only use external staff when they offer unique skills which would not be efficient to have permanently within government.39 The Cabinet Office aims to develop skills and capability within government and make better use of the civil service’s knowledge and experience of difficult programmes.40 We asked the Cabinet Office how it would prevent any attempted efficiencies through reducing staff numbers merely leading to replacement with temporary staff or consultants. The Cabinet Office referred 33 C&AG’s report, paragraph 24 34 Committee of Public Accounts, Thirty-first report of Session 2012–13, Department for Transport: Lessons from cancelling the InterCity West Coast franchise competition, HC 813, paragraphs 7, 14–16; C&AG’s report, para 25 35 Q 97 36 Qq. 92, 93, 95 37 Q 95 38 Q 99 39 Q 92 40 Qq. 92, 109 Efficiency in government 13 to controls to prevent this from happening, such as limits on the number of staff who can be employed in this way, controlling the money available, and controlling departments’ freedom to procure consultants externally.41 Tracking progress
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Government response AI summary
The government agreed with the committee's recommendation (implied by the conclusion's content) to build internal capability, outlining specific actions such as allocating £26 million to a Leadership College, improving functional skills training with targets, creating a Government Consulting Hub, developing the Finance Career Framework, and …
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HM Treasury
18
Conclusion
Twenty-Eighth Report - Efficiency in go…
Accepted
The National Audit Office’s report described how it is important that departments track the progress of efficiency plans, enabling timely intervention and providing assurance that the benefits promised are being realised.42 We questioned the Treasury and the Cabinet Office how it will track the progress of efficiency plans, including the …
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The National Audit Office’s report described how it is important that departments track the progress of efficiency plans, enabling timely intervention and providing assurance that the benefits promised are being realised.42 We questioned the Treasury and the Cabinet Office how it will track the progress of efficiency plans, including the extent to which they achieve their goals or have knock-on impacts.43 We were particularly interested in what processes were in place to monitor benefits realisation, and how they planned to mitigate the limitations of poor data when it comes to tracking progress.44 We also asked the Treasury for a detailed breakdown of which 2015 efficiency targets were met within the 2015 Spending Review period. The Treasury responded in writing that efficiency targets set at Spending Reviews cannot be tracked centrally, and that it is the responsibility of Accounting Officers to monitor and report on progress.45
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Government response AI summary
The government agreed with the committee's recommendation that the Cabinet Office and Treasury should use Outcome Delivery Plans (ODPs) to track the costs and benefits of efficiency plans. It stated ODPs for 2022-2025 are being produced to provide ongoing departmental performance pictures, supported by business …
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HM Treasury
19
Conclusion
Twenty-Eighth Report - Efficiency in go…
Not Addressed
The Treasury described how some of the processes used to scrutinise government plans, such as benchmarking and ongoing project reviews, enable the Treasury and Cabinet Office to monitor the progress of efficiency programmes over time.46 The Cabinet Office told us that quarterly reviews are held between the Cabinet Office, the …
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The Treasury described how some of the processes used to scrutinise government plans, such as benchmarking and ongoing project reviews, enable the Treasury and Cabinet Office to monitor the progress of efficiency programmes over time.46 The Cabinet Office told us that quarterly reviews are held between the Cabinet Office, the Treasury and departments, to hold them to account for progress on programmes, and to look at what new issues they may have encountered.47 The Cabinet Office assured us that benefits realisation will be a strong theme in the Spending Review, and that departments will need to provide clear metrics to track the benefits of their plans, rather than just focusing on expected costs.48 The Cabinet Office told us that its Evaluation Task Force, which is made up of analysts, finance and digital experts, will help assess the performance of projects and scrutinise the results.49 The Cabinet Office intends the taskforce to be able to evaluate programmes more quickly, share learnings and provide quick correction, with its findings made public.50
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Government response AI summary
The government response addresses a different PAC recommendation about using Outcome Delivery Plans to track costs and benefits of efficiency plans, rather than the committee's conclusion #19 which describes existing scrutiny processes and intentions regarding benefit tracking.
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HM Treasury
20
Conclusion
Twenty-Eighth Report - Efficiency in go…
Not Addressed
We asked the Cabinet Office how it is going to deal with the constraints of inconsistent and poor-quality data and legacy systems in tracking the progress of efficiency plans, as described in the National Audit Office’s report.51 The Cabinet Office told us that these are huge issues for government, which …
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We asked the Cabinet Office how it is going to deal with the constraints of inconsistent and poor-quality data and legacy systems in tracking the progress of efficiency plans, as described in the National Audit Office’s report.51 The Cabinet Office told us that these are huge issues for government, which will probably require multiple Spending Review cycles to properly address, and that it is making big investments in these areas as part of the upcoming Spending Review. For example, the Cabinet Office told us it is committing £600 million to upgrading legacy IT systems to bring data into modern digital exchangeable formats. The Cabinet Office also said that it will be investing in making it easier to share 41 Q 106 42 C&AG’s report, para 28 43 Qq. 60, 77, 87, 89 44 Q 77, 87, 89 45 Letter from HM Treasury to Chair 28 September 2021 46 Qq. 43, 77 47 Qq. 77, 87 48 Q 77 49 Q 90 50 Qq. 89, 91 51 Q 89; C&AG’s report, para 29 14 Efficiency in government data between departments and are using the Declaration on Government Reform to encourage departments to have the confidence to be innovative with new technologies and data, which it says will be critical to achieving improvements in public services at a lower cost.52 Embedding efficiency
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Government response AI summary
The government's response addresses forecasting expenditure and Accounting Officer processes, which does not engage with the committee's conclusion about the Cabinet Office's plans for data quality, legacy IT systems, and data sharing.
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HM Treasury
21
Conclusion
Twenty-Eighth Report - Efficiency in go…
Not Addressed
The report by the National Audit Office emphasises the need for efficiency to remain a priority on an ongoing basis, rather than only being taken seriously at major fiscal events such as Spending Reviews.53 The report describes the need for system incentives to be in place, with leadership behaviour that …
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The report by the National Audit Office emphasises the need for efficiency to remain a priority on an ongoing basis, rather than only being taken seriously at major fiscal events such as Spending Reviews.53 The report describes the need for system incentives to be in place, with leadership behaviour that encourages continuous improvement, and that continuous improvement should involve all levels of an organisation.54 We asked the Treasury and Cabinet Office how they will encourage government to embed efficiency as an ongoing process, and encourage departments to use continuous improvement.
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Government response AI summary
The government response addresses a different PAC recommendation about HM Treasury and the Cabinet Office working jointly to instil a culture of continuous improvement, rather than the committee's conclusion #21 which reports on the need for ongoing efficiency and asks how this will be encouraged.
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HM Treasury
22
Conclusion
Twenty-Eighth Report - Efficiency in go…
Accepted
The Treasury told us that the nature of the tight budgets in Spending Reviews forces departments to look within their budgets for improvements and savings, which it says will cause departments to constantly seek improvement.55 The Treasury said that strengthening the finance team in each department will make departments seek …
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The Treasury told us that the nature of the tight budgets in Spending Reviews forces departments to look within their budgets for improvements and savings, which it says will cause departments to constantly seek improvement.55 The Treasury said that strengthening the finance team in each department will make departments seek efficiencies more frequently. The Treasury suggested that if the finance function can have a bigger impact on departmental strategy and service delivery, then departments will unlock efficiencies year on year. The Cabinet Office added that government’s greater focus on service users, such as by using the Public Value Framework, will provide another incentive for continuous improvement since departments will need to respond to their experiences.56 We asked whether staff would be sufficiently incentivised to pursue efficiency plans which might put their own jobs at risk. The Treasury told us that it tries to encourage innovation and suggested that the prospect of career progress would be sufficient incentive for people to come forward with such ideas.57 52 Q 74, 89 53 C&AG’s report, para 33 54 C&AG’s report, para 35 55 Qq. 31, 100 56 Q 102 57 Q 101 Efficiency in government 15
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Government response AI summary
The government agreed with the committee's recommendation that HM Treasury and Cabinet Office should instill a culture of continuous improvement. It outlined plans for HM Treasury to collaborate closely with Government Functions on efficiencies and to provide written plans to the Committee by summer 2022, …
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HM Treasury