Recommendation 8

None of the witnesses were able to tell us at the hearing how many of the 12 HMRC hubs were let on 25-year unbreakable leases. They thought it was one or two, the Permanent Secretary of the Cabinet Office subsequently wrote to us saying it was six. This means that six large hubs are locked into much higher rents than the current market but the capital values for the leases have also declined. HMRC is now trying to sub-let spaces at a rent which is higher than the market. We warned HMRC about this practice. We heard that the Chief Executive of the GPA was now much more open to obtaining a range of freehold and leasehold options for the hubs and other offices. Recommendation 6: The Cabinet Office should write to us within six months splitting out operating costs of the government estate by expenditure type (including lease obligations) and also set out the current £500 million planned savings for each area and what scope there is for additional savings. 8 Managing central government property 1 How the Cabinet Office manages government property