Efficiency group saves 'over £3bn' - but future savings depend on Whitehall

The Cabinet Office efficiency and reform group is seeking to reduce its dependence on a single minister and devolve responsibility for savings out to Whitehall departments, according to Ian Watmore, who heads the group. Watmore told MPs on the Commons' public accounts committee that he wouldn't want to underestimate the importance of having strong ministerial support for the group's drive to cut costs in Whitehall, particularly from Cabinet Office minister Francis Maude. But in response to a question from PAC chair Margaret Hodget about whether the programme is too dependent on Maude's involvement, Watmore said the focus is now "moving away from being a central push" towards being embedded in individual Whitehall departments. Speaking at a PAC inquiry on efficiency on 28 June, Watmore said a number of factors had helped with the cost-cutting drive over the past few months, including the desire to reduce the deficit, which had resulted in people thinking differently about what they do and having an interest in doing things in a new way. Watmore said that while the figures are still being audited, he was "pretty certain" the total saving was more than £3bn, and that £800m of this came from calling in major suppliers to review their existing contracts. Guardian Government Computing reports that over the past few months the Cabinet Office has agreed memoranda of understanding with a number of major suppliers to provide savings. IT accounts for a significant proportion of the business, and Watmore mentioned BT, HP and Fujitsu as companies with which there had been negotiations. "The generality of what we did with suppliers was to get them to reduce their prices," he said. Watmore said that such measures have produced short term savings, but that the effort to improve efficiency in the longer term will require a more systemic change throughout Whitehall. "Long term, we need to change the culture of how Whitehall departments are run and procurement is done," he said, adding that there is a need for more implementation skills at senior level. He emphasised the government's desire to increase the share of its business going to SMEs, saying that even though big deals with single suppliers could provide early cash gains, they can lock government into arrangements that make it harder to find long term savings. The ERG is looking at ways to specify procurements to make it easier for SMEs to participate. Watmore also highlighted a problem in comparing the performance of government departments, since they often have different ways of collecting statistics and recording what they pay for products and services. He cited the example of the cost of laptops, saying some departments provided the cost simply of the hardware, while others would sum it up as a more expensive managed service. "Sorting out that kind of thing is really hard for us to do," he said. So far the ERG has concentrated on central government procurement but the Cabinet Office has said it is keen to help other parts of the public sector get a better deal from their suppliers and has already approached the Metropolitan Police and the London fire brigade.