Money

Over £3.4bn saved as government ramps up cost-cutting programme

More than £3.4bn was saved in 2020/21 through successful efforts to improve efficiency across Whitehall, maximising value for taxpayers and putting more money back into vital public services.

Significant savings were made through cutting losses from fraud and debt (£1.8bn), improved buying decisions (£1.4bn) and more effective use of digital services (£142m).

Data matching, for example, helped crackdown on fraudulent tax discount claims and identify improper PPE contracts for termination, saving more than £138m.

Over £10m of disabled badge fraud was also picked up, as well as just under £7m in illegal housing benefit claims.

The Cabinet Office’s Debt Market Integrator (DMI) has streamlined departments’ access to debt collection services, reclaiming £373m worth of public funds which would not otherwise have been possible.

The Central Digital and Data Office, which advises departments on best practice for using digital and data services, helped cut £137m of digital spend.

As well as this, specialist buying teams drove more than £1bn of savings by ensuring departments pooled resources to buy goods and services.

Commenting, Minister for Government Efficiency, Jacob Rees-Mogg said:

“Taxpayers have the right to expect every penny of their money to be justified before it’s spent.

“These figures show quality need not be sacrificed to achieve better value for money and I want to accelerate the progress made.

“We are ensuring the Civil Service is delivering the government’s top priorities while ensuring the best possible value for taxpayers.”

The Declaration on Government Reform committed to additional transparency and supporting departments through a stronger cross-government network.

This has led to departments sharing data intelligently across their buying teams, pooling together resources and cutting costs for goods and services.

To cut costs further, departments will be required to set targets which measure their ability to achieve the highest standard of public service while reducing spend.

Chief Secretary to the Treasury, Simon Clarke added:

“The £3.4bn saved last year shows that we can get better results from the money we spend.

“We know we need to go further, the Chancellor’s new Cabinet level Efficiency and Value for Money Committee will leave no stone unturned as we investigate all government spending to make sure we are getting the most for the taxpayer.”

The publication of the savings was a key recommendation in Lord Maude’s review of the cross-cutting functions and the operation of spend controls.

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