A cross-Whitehall efficiency crackdown to cut £5.5 billion of
wasteful spending will be announced by the Chancellor on Sunday
20 March.
At the request of the Prime Minister, the Chancellor, will spearhead a new drive on
efficiency, effectiveness and economy in government spending to
ensure departments are delivering the highest quality services at
the best value.
The crackdown will be driven by a new
Chancellor-chaired Efficiency and Value for Money
Committee that will ensure the 5% efficiency target set
at the 2021 Spending Review is met across Whitehall and
scrutinise strategies to prevent fraud and error. The move will
save a total of £5.5 billion with the money being pumped directly
back into vital public services.
As part of the renewed drive, the Chancellor said the NHS
efficiency commitment will double to 2.2% a year - freeing up
£4.75 billion to fund NHS priority areas over the next three
years
These savings will be made through a range of programmes
including the digitisation of diagnostic and front-line services,
which has been shown to reduce cost per admission by up to 13%,
improving the efficiency of surgical hubs and developing digital
tools to cut time spend by NHS staff on admin tasks.
Surgical hubs improve efficiency by separating emergency and
elective care, so more patients can be seen in a given amount of
time, improving value for money without impacting patient safety.
This increased efficiency target will ensure that the record
funding settlement of £188.9 billion a year by 2024-25 for the
Department for Health and Social Care is delivering the best
possible value for money for the taxpayer, the money saved will
be used to fund front line NHS priorities.
Chancellor of the Exchequer, said:
“During these challenging times it’s vital that every single
penny of taxpayers hard-earned cash is being spent well.
“The current level of waste across government is simply not
acceptable – which is why we’re doubling down on wasteful
spending and launching an efficiency drive to make £5.5 billion
worth of savings.
“That money will then be pumped directly into the world class
public services that the British people deserve “
The crackdown will also see a review of Government Arm’s Length
Bodies or “Quangos” who will be expected to save at least £800m
from their budgets.
The Arm’s Length Body Review will see savings come from better
use of property, reduced reliance on consultants, increased
digitisation and greater use of shared services, as well as the
use of benchmarking to drive efficiencies.
The Treasury will also launch a new Innovation Challenge to
crowdsource ideas from civil servants on how government can
reduce waste and improve public services, with winners selected
this Summer and best ideas becoming Government policy
This new Committee comes ahead of the Chancellor’s Spring
Statement on Wednesday 23rd March where the Chancellor will
update Parliament on his plan for the economy in response to the
OBR's latest economic forecasts.
Notes to editors
- The £4.75 billion worth of savings agreed with the Department
of Health and Social Care will come into effect financial year
2022/23. The Arm’s Length Bodies Review will be launched in April
2022, with a target to identify at least £800 million worth of
savings.
- At October’s Budget and Spending Review, the Chancellor set
out a plan to invest in stronger public services, with total
departmental spending growing by £150 billion a year in cash
terms by 2024-25.
- The Efficiency and Value for Money
Committee will be announced to Cabinet on Monday
21st March and deputy co-chaired by the Chief
Secretary to the Treasury and the Minister for Brexit
Opportunities and Government efficiency.
- The first meeting will take place the week commencing
28th
- A 2015 Innovation Challenge received 22,000 responses with 16
measures implemented.
