Recommendation 23

Avoiding adverse effects is a key element of good practice in efficiency reporting. Efficiencies should not adversely affect resilience planning or the experience of service users, and should not add costs to other part of government. This also includes being net of costs, where all transactional and ongoing costs should be netted off from savings and any adverse effects on other programmes should be recognised.33 As part of our examination of efficiency in government in 2021, we found that attempts to improve efficiency can inadvertently reduce the quality of services of increase costs elsewhere, known as cost-shunting. In particular, we noted that efficiency plans without a clear idea of the implications for service users had led to problems. We therefore recommended that the Treasury should ensure that, in their efficiency plans, departments considered 28 Qq 34–35, 42–47, 66; C&AG’s Report para 3.11 29 Qq 34, 47, 81 30 Q 9 31 Q 12 32 Qq 7–9 33 Qq 40, 75; C&AG’s Report Figure 7; and Comptroller and Auditor General, Efficiency in government, Session 2021–22, HC 303, National Audit Office, July 2021 Cabinet Office functional savings 15 what the potential impact might be on service users, and that data on this was tracked as programmes were implemented.34 In its response to our report, government accepted our recommendation and explained that as part of the 2021 Spending Review it had published an updated set of Priority Outcomes and Metrics to capture the real-world impacts of savings. It also noted that departments were required to report on their progress against these metrics, which enabled Ministers and officials to identify where outcomes were at risk of note being achieved and take action.35