Shared services not delivering, says NAO

Prospective £1.4bn savings not yet materialising, according to public sector spending watchdog

Government shared services programmes are not delivering the levels of administrative savings that is possible, according to the National Audit Office (NAO).
The Cabinet Office estimates Whitehall departments could save £1.4bn per year by centralising finance and human resources (HR).

But though projects going ahead in the NHS and HM Prison Service are on course for significant cost savings, progress across the sector is slow.

Sir John Bourn, head of the National Audit Office, said: "Central government needs to get much better at managing its corporate services.

"Shared services have the potential to deliver significant efficiency savings but it is not yet clear that the £1.4 billion of savings estimated by the Cabinet Office will be achieved."

Programmes are in place across government – including the Flex desktop scheme kicked off by the Cabinet Office in the summer – but reported savings are small so far. In March, total reported savings stood at £1bn, £315m of which related to finance and HR. But how much of the figure was related to shared service projects.