• Home
• GOVERNMENT CXO
• GOVERNMENT CFO
• INFORMATION MANAGEMENT
• E-GOVERNMENT
• CONNECTED GOVERNMENT
• OPEN GOVERNMENT
• MOBILE GOVERNMENT
• CITIZEN ENGAGEMENT
• INFORMATION SECURITY
• GOVERNMENT CLOUD
• GOVERNMENT GIS
• DIGITAL INCLUSION
• EDUCATION IT
• HEALTHCARE IT
• PUBLIC SAFETY
• PUBLIC INFRASTRUCTURE

Connected Government, E-Government, Government Cloud

UK government overspends £500m on shared services

By Gosia Klimowicz | 13 July 2012 | Views: 1731

Poor leadership from the Cabinet Office caused the £500 million overrun on five shared government services centres serving the Ministry of Justice, DWP, Defra, DFT and Research Councils UK. Shared services was the government’s initiative to reduce civil service admin costs by 20%.

Photos

View photos

Related Articles

• UK Government grants US$11.4 mil for cyber security research
• New Zealand government boosts digital services
• UK Government Releases Data on Cost of Transactions

Related Categories

• CONNECTED GOVERNMENT
• E-GOVERNMENT
• GOVERNMENT CLOUD

From this Section

• NEWS

According to the report by the National Audit Office (NAO) the services “overly tailored” for individual departments flexibility and increased costs. There were no adequate benchmarks in place to assess how the shared services centres were performing.

“The initiative for government departments to share back-office functions has suffered from an approach which made participation voluntary and tailored services to meet the differing needs of individual departments,” said NAO head Amyas Morse.

While performing adequately, the shared services had cost £1.4 billion to build and operate compared to an expected cost at the start of the project in 2004 of £0.9 billion. These five centres were also expected to have saved £159 million by the end of 2010-11. In the event, the Ministry of Justice centre broke-even, the Department of Work and Pensions and the Department for Environment, Food and Rural Affairs centres did not track their total savings, and the two centres that are tracking savings, the Department for Transport and Research Councils UK, have reported a net cost to date of £255 million.

According to the report, the current strategy will only be effective if the Cabinet Office demonstrates strong leadership to deliver greater value for money and gets buy-in from departments. The Cabinet Office must drive cultural change to secure the intended savings. The Cabinet Office should also develop comparable data on the cost and quality of services provided by the shared services centres, which should allow it to establish a baseline for current performance and set benchmarks for improvement. It should consider whether it can extend its shared services strategy to include other common functions needed by central government departments.