Government cuts £1.7bn in costs from major projects

The government has saved around £1.7bn from major projects as part of an efficiency drive that realised £10bn in savings across Whitehall last year

Cabinet Office minister Francis Maude said new figures published today for 2012/13 show the government saved £10bn through its efficiency drive, exceeding its stated target of £8bn.

The savings are calculated by comparing spending over 2012/13 with 2009/10 - the last year before the general election. It follows £3.75bn in savings in the year after the general election and £5.5bn in 2011/12.

The Cabinet Office said the savings include £1.7bn through reviewing and reshaping large scale projects, including construction, and stripping out inefficiencies.

A Cabinet Office spokesman said £400m of the £1.7bn in savings was directly from construction projects, including £145m in cost reductions on the Crossrail project, and £86m in saved by the Education Funding Agency on the construction costs of school projects.

The efficiency programme has been led by the Efficiency and Reform Group - a joint Cabinet Office and Treasury initiative.

Other savings include:

• £3.8bn by linking together departments to buy goods and services and enforcing sensible controls on recruitment and use of consultants;
• £1.1bn by improving online services, and raising money through selling empty buildings and exiting expensive rentals in sought-after locations;
• £3.4bn by reducing the size of the Civil Service and reforming Civil Service pensions.

Maude said: “The unprecedented £10bn savings last year shows we have defied expectations and accelerated the pace of reform. There can be no going back to the old, wasteful ways of doing things which we saw in the past.”