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Maude Francis V Neck

Francis Maude is the Minister for the Cabinet Office and Paymaster General, and is MP for Horsham

This morning, the Chancellor and I have announced that this Government saved an unprecedented £14.3 billion last year, measured against the baseline of Labour’s last year in office, through the efficiency and reform work which my department set up after the 2010 General Election. The £14.3 billion is the equivalent of almost £850 for each working household across the country. These savings follow the £10 billion we saved for 2012-13, £5.5 billion for 2011-12 and £3.75 billion in 2010-11, all measured against the same baseline.

Our savings are the product of a long, hard grind to drive out costs which has involved civil servants across Whitehall and, in particular, my excellent officials in the Efficiency and Reform Group, and their colleagues in the Treasury. Efficiency savings are not exactly the sort of stuff which gets people’s pulses racing, but they are vitally important. They save money from running costs and back offices rather than front line services. I think everyone should wonder why Ed Miliband didn’t start doing some of this when he was sitting in my chair as Minister for the Cabinet Office.

Since day one, this Government’s long-term plan for the economy has been to ensure that we live within our means. In opposition, we promised that we would do what every business and family does in tough times – look carefully at every item of spending and work out which costs we can slice out. That’s the Conservative approach to managing public finances, and what hard-working taxpayers rightly expect from us.

You would think that Labour would welcome these savings, because every pound we save through efficiencies is a pound not cut from public services. They are promising a zero-based review, but may not complete it until the first year after the next election. How is that good enough? We are already getting on with doing what they are still thinking about reviewing. We came into office with a fully developed plan of action, and started implementing it from the start. Our spending controls were slapped on common areas of spend such as digital, consultancy, advertising and marketing and property within days. That’s how we managed to make many of these enormous savings.

All Labour seems to be able to do is suggest what we are already doing, and then criticise us for doing it. They are calling for shared back office services – but, when we introduced this, Labour MPs lined up to attack us. Labour talked the talk about quango reduction, but then voted against the legislation which allowed us to get rid of so many public bodies. Almost a third of the ones we inherited in 2010 have gone already. Labour are even attacking spending which they themselves agreed to in office.

In a peak of hypocrisy, Labour have even tried to complain that “many government IT systems are out of date, inefficient, and expensive to run”. That’s partly true – but they were the ones who signed the contracts and lumbered us with clunky, out-dated technology! Some of these contracts don’t expire until after the 2015 election, so we haven’t been able to make some savings that we know we will be able to after then. Labour’s record on IT was pretty disastrous: they promised to have all government services delivered electronically by 2008, and that failed. Their idea of a digital service seemed to involve you printing out a form, filling it in by hand and then walking to the post box – hardly digital by default. And whether it was NHS IT or the department which had to pay £30,000 to change a word on a website, they seemed incapable of getting anything right.

Our approach has been to introduce a rigorous, business-like approach to Government. At the time of the last election, Whitehall didn’t know who its major suppliers were, let alone how much it was spending with them. Departments were spending drastically different amounts for the same products: one was spending over seven times what another was for a simple printer cartridge. In the first few months, I led renegotiations which saved us £800 million. Our procurement and commercial reforms are still reaping rewards, and they helped us save over £5.4 billion last year against a 2009-10 baseline.

We haven’t just saved enormous amounts of money. We have also made things much easier for small businesses. Back in 2010, they were almost systematically excluded from winning government work. We have stripped out complex procurement practices to level the playing field. SMEs are now on track to win a quarter of government business by next year. And while our digital suppliers used to come from a small group, mainly around London, we are now buying services and technology from right across the country.

I’ve set out our ambition to have the best digital government offering in the G7 by the time of the next election. We are well on the way to meeting that. Our new gov.uk website isn’t just saving money. It actually won a prestigious design award, beating off competition from the Shard and the Olympic Torch. By next year, 25 of the government’s biggest transactional services – from applying for an apprenticeship to completing a tax return – will be available online. This will make things a bit easier for businesses and the public when they need to interact with government. And it will save money, because a digital service is 20 times cheaper than by phone, 30 times cheaper than by post, and 50 times cheaper than a face to face transaction.

We know we have already saved a huge deal, but there’s just so much more to do. That’s why I was so pleased that, in the Budget, the Treasury asked us to set out a programme of savings for 2016-17 and across the next Parliament in time for the next Autumn Statement.

Labour were in power for 13 years, and they simply threw money down the drain – no wonder by the end they had to admit that there was ‘no money left’. We came into government saying we would cut waste – and we have more than delivered our promise. So, yes, today we can be proud of the progress we have made. Eliminating waste and cutting the deficit is a key part of this Government’s economic plan for the long-term. This is about backing hardworking people by spending taxpayers’ money responsibly, keeping mortgage rates down so people have more financial security and building a better future for our country. It is my mission to carry on pushing, challenging and driving departments to deliver more for less. That’s just what I’m going to keep doing.

21 comments for: Francis Maude MP: How we saved almost £850 for each working household last year

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