Source · Select Committees · Public Accounts Committee
Fiftieth Report - Government Shared Services
Public Accounts Committee
HC 734
Published 5 May 2023
Recommendations
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 …
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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.
HM Treasury
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9
Accepted
Inadequate contingency planning exposes Synergy shared services cluster to significant delivery risks.
Recommendation
The Department for Work & Pensions explained that the only contingency plans the ‘Synergy’ cluster had in place should it not receive the required level of funding for its shared services plans would be to implement its plans more slowly. …
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Government Response Summary
The government agrees, stating that existing contingency planning includes assessing feasibility under different scenarios and that an extension with SSCL was negotiated to ensure service continuity for ISSC2, addressing concerns about back-up plans and ageing systems.
HM Treasury
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10
Accepted
Previous recommendation highlighted necessity of comprehensive business cases for shared services success.
Recommendation
When we last reported on government shared services in 2016, we recommended that the then current strategy should be supported by a realistic and complete business case that was updated regularly.12 This is in line with HM Treasury guidance that …
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Government Response Summary
The government agrees to develop a hybrid business case/updated case for change by May 2024, embedding key Green Book elements and assured by the IPA, to provide comprehensive articulation of governance, costs, and benefits for the strategy.
HM Treasury
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11
Accepted
Cabinet Office failed to produce central business case, leading to rejected funding bids.
Recommendation
The Cabinet Office told us that it did not produce a business case for its current strategy as it believed time was of the essence in terms of both cost opportunities and the fact that old systems were coming to …
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Government Response Summary
The government agrees to develop a hybrid business case/updated case for change by May 2024, which will address the previous lack of detail on costs, benefits, and risks, and will be assured by the IPA.
HM Treasury
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12
Accepted
Absence of early central business case hindered risk management and taxpayer savings.
Recommendation
The Cabinet Office plans to revisit its “Case for Change” now that clusters have completed their own individual business cases, updating this to include a more detailed position on the costs and benefits of the strategy.19 We noted that the …
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Government Response Summary
The government agrees to develop a hybrid business case/updated case for change by May 2024, embedding key Green Book elements and assured by the IPA, to provide a detailed central position on the strategy's costs and benefits.
HM Treasury
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17
Accepted
Cabinet Office actively revising and standardising shared services benefits estimates for consistency.
Recommendation
The Cabinet Office told us that it is working with HM Treasury and all five clusters to revise and externally validate these estimates and obtain a benefits figure from the ‘Defence’ cluster. It said that it is working to ensure …
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Government Response Summary
The government agrees and is actively developing a consistent, cross-strategy framework for identifying, defining, and monitoring benefits, in collaboration with Ernst & Young, to ensure consistent calculation and validation of estimates.
HM Treasury
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Conclusions (17)
2
Conclusion
Accepted
The Cabinet Office did not produce an overarching business case for the Shared Services Strategy, which has hindered progress. HM Treasury’s guidance to government departments states that a business case should be used to support all major programmes and projects considered by the Cabinet Office. The Cabinet Office did not …
Government Response Summary
The government agrees and will develop a hybrid business case/updated case for change, incorporating key areas of a Green Book programme business case, which will be assured by the Infrastructure and Projects Authority (IPA). It clarifies that a full business case was not appropriate for a de-centralised strategy.
4
Conclusion
Accepted
The benefits of the strategy have not been properly quantified. The Cabinet Office did not calculate anticipated benefits of the refreshed strategy, and instead has relied on clusters developing cost and benefits figures as parts of their own separate business cases. These business cases have identified potential benefits of £2 …
Government Response Summary
The government agrees and is working with Ernst & Young (EY) to develop a consistent framework for identifying, defining, and tracking benefits across the strategy. A draft report from EY has been produced and is undergoing a detailed feedback exercise.
5
Conclusion
Accepted
The Cabinet Office has yet to start monitoring overall progress of the government’s Shared Services Strategy. The Cabinet Office has no performance indicators that measure strategy progress. Shared services performance measures consider only business-as-usual service provision such as payroll accuracy, invoice accuracy, end- user satisfaction, government transfers and mobility of …
Government Response Summary
The government agrees and has begun developing a new set of performance metrics, using a portfolio-light approach, to monitor the overall progress of the Shared Services Strategy and track clusters' progress by sourcing top-line information across government.
6
Conclusion
Accepted
There are lessons to be learned from this strategy that will be applicable to future government projects. We have often reported on the challenges that government faces in delivering cross-departmental initiatives, programmes and strategies. A number of these issues continue to cause problems for the current iteration of the Shared …
Government Response Summary
The government agrees and is actively disseminating lessons learned through a stock of documents, tools, and working groups. Examples include incorporating lessons from other programmes, learning from international governments, and committing to future sharing of insights, with briefings offered through IPA.
1
Conclusion
Deferred
On the basis of a Report by the Comptroller and Auditor General, we took evidence from the Cabinet Office and the Department for Work & Pensions, the lead department for the ‘Synergy’ shared services cluster, on government shared services.1
Government Response Summary
The government's response acknowledges a 'recommendation' (despite the committee text being a conclusion) and describes assessing strategy feasibility under different scenarios, along with negotiating a two-year contract extension for ISSC2 customer departments to ensure service continuity until October 2025, rather than addressing the committee's observation.
7
Conclusion
The government is just over four years into its latest Shared Services Strategy. Since the Cabinet Office refreshed it in 2021, introducing the ‘cluster’ delivery model, there has been a step change in progress. The ‘Defence’ and ‘Overseas’ clusters have begun to implement new systems. The departments in the ‘Matrix’, …
8
Conclusion
Accepted
The Cabinet Office told us that the strategy is on track.8 However, several risks remain to its delivery. For example, the Department of Work & Pensions set out three main risks for the ‘Synergy’ shared services cluster: funding uncertainties; a tight timetable; and realising the potential benefits of the strategy. …
Government Response Summary
The government agrees with the committee's observation of risks and commits to assessing the feasibility of the Shared Services Strategy under various funding scenarios by November 2023. They have also secured a contract extension with SSCL until 2025 to ensure service continuity and are actively engaging HM Treasury regarding funding for the 2024 Spending Review.
13
Conclusion
Accepted
Although HM Treasury rejected cluster bids for funding, it approved a funding envelope of £300 million to cover the period up to 2024–25. This was to support these clusters to deliver the strategy and to address the risk that departments could be left with unstable and unsupported systems in the …
Government Response Summary
The government agrees and is actively communicating with HM Treasury to ensure funding for the 2024 Spending Review (SR24), with a target implementation date of November 2023. Initial funding of £126.58 million has been granted to clusters, and ongoing work on Final Business Cases and a benefits framework will inform future SR24 bids.
14
Conclusion
Accepted
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 available.23 The Department for Work & Pensions told us that …
Government Response Summary
The government agrees and is actively communicating with HM Treasury to ensure funding for the 2024 Spending Review (SR24), with a target implementation date of November 2023. Initial funding of £126.58 million has been granted to clusters, and ongoing work on Final Business Cases and a benefits framework will inform future SR24 bids.
15
Conclusion
Accepted
The Cabinet Office’s original expectation was that the strategy would lead to savings of 10% to 15% in operating costs, based on what other large public and private sector organisations across the world had been able to achieve.26 It did not calculate specific programme-wide costs and benefits from the outset. …
Government Response Summary
The government agrees with the committee's observation and is developing a comprehensive cross-strategy benefits picture, with a target date of September 2023. Work is ongoing with Ernst & Young to create a framework for consistent benefit identification, classification, and monitoring to ensure accountability and strategic alignment.
16
Conclusion
Accepted
In autumn 2022, the business cases of three clusters (‘Synergy’, ‘Matrix’ and ‘Unity’) identified potential benefits (both “cashable” and “non-cashable”) of £2 billion at an estimated cost of £0.9 billion.29 However, the three clusters have not calculated these figures on a consistent basis. For example, clusters have different definitions for …
Government Response Summary
The government agrees and is developing a consistent framework for benefit identification, definition, and monitoring across the strategy, in collaboration with Ernst & Young, to address previous inconsistencies in cluster calculations.
18
Conclusion
Accepted
The Cabinet Office has no performance indicators that measure progress of the Shared Services Strategy.34 When asked what metrics were used to monitor progress of the strategy, the Cabinet office told us that there are three elements to this: two that are currently underway and one that it is working …
Government Response Summary
The government agrees and has begun developing a new set of performance metrics to monitor the overall progress of the strategy, including service improvement and implementation of new systems, by sourcing top-line information across government.
19
Conclusion
Accepted
The final element that the Cabinet Office is working on is how to identify and implement measures that will drive quality and performance in the future.37 It explained that each cluster is accountable for delivery and has its own team tracking progress, but it acknowledged the importance of being able …
Government Response Summary
The government agrees and has started developing a new set of performance metrics to monitor overall strategy progress and service improvement, aiming for a single perspective across government by sourcing top-line information from clusters and supporting programmes.
20
Conclusion
Accepted
Once the new services and updated technology are in place, the Cabinet Office said it plans to revise the business-as-usual performance measures, many of which are decades old, in order to utilise more modern measurements such as the net promoter score, a metric that assesses the user’s likelihood of recommending …
Government Response Summary
The government agrees with the committee's observation and, with a target date of September 2023, is developing a new set of performance metrics. These will evolve from delivery-oriented measures to monitor progress in implementing new systems and demonstrating service improvements, including a portfolio light approach to gauging future capability and capacity needs.
21
Conclusion
Accepted
We have often highlighted the various challenges that government faces in delivering cross-departmental initiatives, programmes and strategies. These challenges include measuring and reporting of progress, common data, getting departmental buy- in, and achieving the right balance between central and departmental responsibilities, coordination, leadership and ownership. Examples include our 2022 reports …
Government Response Summary
The government agrees and is progressing various "lessons learned" initiatives, including meetings with other governments, incorporating past program lessons, developing toolkits, and facilitating working groups, to address common challenges in cross-departmental initiatives for the Shared Services Strategy.
22
Conclusion
Accepted
The Cabinet Office said that each cluster has undertaken a lessons learned exercise. For example, the ‘Synergy’ cluster’s outline business case explicitly goes through the lessons learned and says how those are addressed in their programme.42 The Department for Work & Pensions noted that one of the lessons learned from …
Government Response Summary
The government agrees and states that it is progressing a lessons learned strategy, with a target implementation date of June 2025. They have initiated various activities including creating toolkits, holding events, incorporating lessons from other programmes, and facilitating working groups, with the Overseas cluster committing to share its lessons within four months.
23
Conclusion
Accepted
There has been a noticeable change in pace since the introduction of the 2021 strategy refresh.45 The Cabinet Office highlighted what was different, namely that government functions such as HR, finance and commercial had taken the lead and set standards for departments to use. It explained that departments were working …
Government Response Summary
The government agrees and is progressing the strategy through relationship management and extensive lessons learned initiatives, including sharing insights from other governments and programs, providing toolkits, and facilitating communities of best practice for clusters.