Government departments will be expected to find savings and
efficiencies in their budgets, in a push to drive out waste in
the public sector and ensure all funding is focused on the
government's priorities.
Every single pound the government spends will be subjected to a
line-by-line review to make sure it's being spent to deliver the
Plan for Change and that it is value for money, as the Chancellor
today (Tuesday 10 December)
launches the next round of government spending.
It will be the first time in over a decade and a half that
government departments have been asked to take such an approach,
with what's called a “zero-based review” last undertaken 17 years
ago.
Reeves will today begin her work with government departments and
reiterate that they cannot operate in a business-as-usual way
when reviewing their budgets for the coming years, as the new
government continues to fix the foundations after inheriting a
£22bn black hole, alongside crumbling public services and damaged
public finances.
Secretaries of State across government will need to allocate
their budgets to ensure that government spending is focused
on the Prime Minister's Plan for Change, and that every
pound of taxpayers' money is spent well. The Chancellor will work
with departments to prioritise spending that supports the
milestones to deliver the Plan. This includes boosting growth to
put more money in working people's pockets, fixing the NHS,
creating safer streets, making Britain a clean energy super-power
and giving every child the best start in life while strengthening
our borders, national security and the economy.
Chancellor of the Exchequer said:
“By totally rewiring how the government spends money we will be
able to deliver our Plan for Change and focus on what matters for
working people. The previous government allowed millions of
pounds of taxpayers' money to go to waste on poor value for money
projects. We will not tolerate it; I said I would have an iron
grip on the public finances and that means taking an iron fist
against waste.
“By reforming our public services, we will ensure they are up to
scratch for modern day demands, saving money and delivering
better services for people across the country. That's why we will
inspect every pound of government spend, so that it goes to the
right places and we put an end to all waste.”
The Prime Minister has been clear that public services must
reform if they are to be put on a sustainable footing in the
long-term, so that outcomes can be improved for people who depend
on services every day. Today's announcement builds on the
Chancellor of the Duchy of Lancaster yesterday launching a £100
million fund to pioneer public service reform and deliver the
Government's Plan for Change, by deploying new test-and-learn
teams into public services across the country. They will be
empowered to experiment and innovate to fix the public sector's
biggest challenges, working towards the Government's ambitious
and far-reaching reform programme that will seek to break down
Whitehall silos and galvanise government as it seeks to deliver
the Plan for Change.
Departments will ensure budgets are scrutinised by challenge
panels of external experts including former senior
management of Lloyd's Banking Group, Barclays Bank and the
Co-operative Group. Panels will bring an independent view to what
government spend is or isn't necessary, with a mixture of
expertise from local delivery partners, think tanks, academic
experts and private sector backgrounds.
In letters sent by the Chief Secretary to the Treasury,
departments will be advised that where spending is not
contributing to a priority, it should be stopped. Although some
of these decisions will be difficult, the Chancellor is clear
that the public must have trust in the government that it is
rooting out waste and that their taxes are being spent on their
priorities.
Work has already begun on evaluating poor value for money spend,
with an evaluation into the £6.5m spent on Social Workers in
Schools programme, which placed social workers in schools,
finding no evidence of positive impact on social care outcomes,
meaning the intervention was not considered cost-effective. The
Government has made clear it will not shy away from taking the
difficult decisions needed to fix the foundations, as shown by
the Chancellor's decisions at the Budget to balance the books.
Departments will be expected to work closely together to identify
how their work contributes to the Government's missions, meeting
in mission clusters throughout the process to agree priorities
and links.
Throughout this process, the ideas, expertise and innovation of
the private sector will be sought out and brought right into the
heart of government. An online portal will also be launched
to give businesses the opportunity to put forward policy
proposals for the Spending Review, including on how government
can deliver public services more efficiently or effectively.
These representations will be collated and shared with
departments for consideration in their submissions.
