Recommendations & Conclusions
6 items
4
Recommendation
Thirty-First Report - Managing central …
Acknowledged
We are sceptical that the Government Hubs programme still represents good value for money in the current climate. The Government Hubs programme relocates civil servants from small offices into large, modern government hubs located in cities across the United Kingdom. The government plans to deliver at least 31 government hubs …
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We are sceptical that the Government Hubs programme still represents good value for money in the current climate. The Government Hubs programme relocates civil servants from small offices into large, modern government hubs located in cities across the United Kingdom. The government plans to deliver at least 31 government hubs and, potentially, up to 50. Demand for office space has decreased since the pandemic and it is unclear what long-term impact this will have on commercial rents. Government has incomplete data on the usage of offices and, although new systems are being rolled out to gather such data, it is not yet available. From the limited data available, GPA has calculated at least a 25% reduction in office usage. It is therefore possible that fewer hubs, or smaller hubs, will now be required. Our witnesses were not able to tell us how many government hubs were on long-term, fixed leases. Without a clearer understanding of what is needed, the government risks being locked into long-term, expensive leases, the costs of which could be passed on to the departments that sublet space for years to come. Recommendation 4: In its Treasury Minute response to this report, the Cabinet Office should set out in detail the benefits and costs, including valuation drops compared to previous prices to date of the Government Hubs programme and how it will be adapted in-light of the new estimates for post pandemic office usage.
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Government response AI summary
A progress report is provided to Ministers, on the Hubs Programme, biannually with the next due in the Summer 2023, which will be used to provide an annual update to the committee.
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HM Treasury
5
Conclusion
Thirty-First Report - Managing central …
Acknowledged
In addition to this, the Cabinet Office should update us yearly on the rollout of the hubs programme. Such updates should include the lease term and next available break point for each GPA hub, the extent to which offices are being sublet, the current levels of vacant space and what …
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In addition to this, the Cabinet Office should update us yearly on the rollout of the hubs programme. Such updates should include the lease term and next available break point for each GPA hub, the extent to which offices are being sublet, the current levels of vacant space and what plans government has to sublet this space in the short to medium term.
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Government response AI summary
The Cabinet Office has commissioned departments to produce a forward look of their planned disposal activity to 2030, which will be refreshed periodically to enable analysis and monitoring of disposal plans.
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HM Treasury
6
Recommendation
Thirty-First Report - Managing central …
Acknowledged
It is unclear how the government will meet its target for property disposals, given the past struggles of such programmes and current market uncertainty. The new government property strategy has set a target for disposing of surplus property, to generate £1.5 billion by 2025 that can be reinvested into the …
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It is unclear how the government will meet its target for property disposals, given the past struggles of such programmes and current market uncertainty. The new government property strategy has set a target for disposing of surplus property, to generate £1.5 billion by 2025 that can be reinvested into the estate. Detailed plans have not been published about how it will achieve this target. In our report on the last disposals programme, many departments were significantly behind their targets for land disposals. This time, the Cabinet Office needs to ensure that the departments with the largest land holdings fully participate in the disposals programme. Recent market turbulence may also negatively impact the programme. Cabinet Office officials acknowledged such risks and assured us that there will not be a fire sale of assets. Recommendation 5: The Cabinet Office should write to us by April 2023, setting out how it intends to reach its property disposal target, including: • KPIs; • milestones; • disposals targets for each portfolio; Managing central government property 7 • how it is monitoring compliance from all departments; • and how it is ensuring value for money during market fluctuations
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Government response AI summary
The response notes the Committee’s conclusion and points to the overall success of the 2018 Government Estate Strategy in unlocking savings and efficiencies.
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HM Treasury
1
Conclusion
Thirty-First Report - Managing central …
Acknowledged
On the basis of a Report by the Comptroller and Auditor General, we took evidence from the Cabinet Office, including the Permanent Secretary, Chief Property Officer, the Government Head of the Property Profession and the Chief Executive of the Government Property Agency on the management of central government property.1
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On the basis of a Report by the Comptroller and Auditor General, we took evidence from the Cabinet Office, including the Permanent Secretary, Chief Property Officer, the Government Head of the Property Profession and the Chief Executive of the Government Property Agency on the management of central government property.1
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Government response AI summary
The department has now published on GOV.UK a bespoke property data standard, to enable better data collection for all of the government estate and the procurement of the new property database is due to take place throughout the course of 2023 with the expectation that …
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HM Treasury
20
Conclusion
Thirty-First Report - Managing central …
Acknowledged
The new strategy’s emphasis on efficiency is also reflected in the plan to cut the estate’s annual running costs by £500 million.51 In 2020–2021, the operating cost for central government property was £22 billion.52 We asked the Cabinet Office if it considered government’s current operating cost to property value ratio …
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The new strategy’s emphasis on efficiency is also reflected in the plan to cut the estate’s annual running costs by £500 million.51 In 2020–2021, the operating cost for central government property was £22 billion.52 We asked the Cabinet Office if it considered government’s current operating cost to property value ratio was at the right level.53 The 44 Qq 98, 101; Government Property Function, Government Property Strategy: 2022–2030, 13. 45 Q 124 46 Q 122 47 Qq 71, 123 48 Q 98. 49 Committee of Public Accounts, Optimising the defence estate, Twentieth Report of Session 2021–22, HC 179, 12 October 2021; Committee of Public Accounts, Sale of public land, One Hundred and Tenth Report of Session 2017–19, HC 2040, 24 July 2019 50 Qq 125, 101. 51 Q 95 52 Qq 1, 95; Cabinet Office, State of the Estate 2020–21, December 2021 53 Q 95 14 Managing central government property Cabinet Officed explained that the operating costs include rent on the 11% of government property that is leasehold. It also includes other significant costs, such as £8 billion spent on facilities management.54
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Government response AI summary
The government notes the Committee’s conclusion and refers to savings and efficiencies unlocked by the 2018 Government Estate Strategy and the goals of the recently published Government Property Strategy 2022-2030.
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HM Treasury
21
Conclusion
Thirty-First Report - Managing central …
Acknowledged
We questioned whether the government’s plan to save £500 million on operating costs by 2025 was ambitious enough, noting that it only represents approximately a 2% reduction.55 Cabinet Office officials told us the target was a cautious one and that it might be able to save more. It explained that …
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We questioned whether the government’s plan to save £500 million on operating costs by 2025 was ambitious enough, noting that it only represents approximately a 2% reduction.55 Cabinet Office officials told us the target was a cautious one and that it might be able to save more. It explained that department officials had spoken to government organisations and were confident that £500 million could be saved from specific initiatives, including efforts by the GPA and the Department for Work and Pensions.56 It was possible that other government bodies, such as the NHS, might also be able to generate additional savings. The Cabinet Office also pointed out that it had recently revised the government’s facilities management requirements. The Cabinet Office expects the new requirement to lead to improved contracts and, given that facilities management accounts for £8 billion per year, some significant additional savings.57 54 Q 97 55 Q 96; Government Property Function, Government Property Strategy: 2022–2030, 13 56 Q 95 57 Qq 96 - 97 Managing central government property 15
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Government response AI summary
The government notes the Committee’s conclusion that the plan to reduce the operating costs of the government estate is not sufficiently ambitious.
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HM Treasury