Source · Select Committees · Public Accounts Committee
Recommendation 3
3
Accepted
Resolve short and long-term funding uncertainties for the Shared Services Strategy.
Recommendation
Departments do not have the funding they need to deliver on their Shared Services Strategy. There are both short- and long-term funding uncertainties to delivering the strategy. In the short-term, HM Treasury approved a funding envelope of £300 million to support the clusters to deliver the strategy and to address the risk that 6 Government Shared Services departments could be left with unstable and unsupported systems in the interim. This covers the 2021 Spending Review period to 2024–25. Departments have stated that this settlement may not be enough to allow them to proceed with their preferred procurement options if final costs, which they currently estimate to be between £382 million and £403 million, continue to exceed the funding envelope. In the long- term, clusters have forecast that an additional £480 million of investment funding is required in the subsequent Spending Review period after 2024–25 to deliver the full strategy. There is clearly a risk to the delivery of this business-critical change programme since there is no guaranteed level of funding. Recommendation 3: In its six-month update, the Cabinet Office should set out what action has been taken to resolve both the short- and long-term funding uncertainties outlined above.
Government Response Summary
The government agrees and has secured initial funding of £126.58 million for clusters to proceed to the final business case (FBC) stage. FBCs will include whole life costs and a benefits framework is being developed, both to assist in formulating bids for the 2024 Spending Review (SR24) to resolve long-term funding uncertainties.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. in the 2024 Spending Review (SR24). There is knowledge and experience within the funding space. Previously, for SR21 an extensive bidding process was completed with three clusters (Synergy, Matrix and Unity) which resulted in the programme being granted £300 million in reserve funding. Work then began on initial business cases which resulted in approval and each cluster being granted initial funding of £126.58 million which will allow the clusters to proceed through the final business case (FBC) stage. Vitally, FBC’s will contain Strategy whole life costs; this will be beneficial in formulating SR24 bids. Additionally, ongoing work on a benefits framework will enable us to qualify the full value for money that the Strategy will deliver which will assist in formulating SR24 bids.