Government expects extra £5 billion efficiency savings

24 November 2008
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24 November 2008 | Jake Kanter

The government aims to make an extra £5 billion efficiency savings including procurement cost-cutting over the next two years in a bid to boost the economy.

Delivering the pre-budget report this afternoon, chancellor Alistair Darling said the public sector could secure cost reductions of £35 billion by 2010-11 through better procurement and greater back office efficiencies.

Last year Darling announced the government planned to drive efficiency savings of £30 billion (News, 18 October 2007). Today he told Parliament that the £5 billion in extra savings would support the financial backing given to families and businesses during a recession.

"We know extra savings are achievable because independent reviewers have identified new efficiencies across public sector operations," he said. "The efficiencies will come through lowering the cost of back office operations, better procurement, examining property holdings and asset sales. By continuing to make efficiency savings, we can help fund the action needed to help families and businesses."

The government also responded to recommendations in the Glover Review, which looked into helping small businesses secure better access to public contracts (Web news 17 June).

Darling said public sector contracts worth more than £20,000 would be advertised in a single free online portal, and measures to reduce bureaucracy and make opportunities more transparent will be introduced.


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