Skip to main content

Gershon Target

Volume 454: debated on Thursday 7 December 2006

8. What progress has been made towards the Gershon efficiency savings target; and if he will make a statement. (104889)

As we set out in the pre-Budget report, at the September halfway point in the three-year Gershon efficiency programme, Departments and local authorities had reported annual efficiency gains amounting to £13.3 billion-worth of the £21 billion target.

To corroborate the figure that the Minister quoted, would he be willing to publish an independently audited report setting out the savings by Department and by programme? Could he give the House information about the five biggest savings that have been identified as part of the Gershon programme?

The departmental figures will be in the departmental autumn reports. There has been a lot of scrutiny of this programme by the National Audit Office—that has been welcome—which said that the programme has been more systematic than previous attempts. It made several observations when it reported in February and since then, we have been working with it to ensure that the numbers are more robust. I think that it will report again early in the new year, and I look forward to hearing what it has to say.

On additional numbers, I can tell the hon. Gentleman that of the £13.3 billion-worth of overall savings, £5.5 billion came from procurement, £2.4 billion came from productive time, and £1.5 billion came from policy funding and regulation. I agree that it is important that we provide full information on the programme, because the more transparency there is, the better the chances of success.

Does my right hon. Friend agree that it is right, when possible, to make savings in bureaucracy and the administrative function of Government in order to move resources to front-line public services such as policing, schools and hospitals? In doing that, will he reject outright any proposals that the Treasury may have received to reduce overall public expenditure, as the Conservative party proposes?

I completely agree. My hon. Friend heard my right hon. Friend the Chancellor announce yesterday that each Department will be required to reduce its spending on administration by 5 per cent. year on year throughout the comprehensive spending review. I also agree with my hon. Friend about the way in which the freed-up resources should be used. We shall certainly reject proposals for £20 billion-worth of tax cuts in the Tory tax report, the £40 billion in tax cuts that the Cornerstone group proposes or the £50 billion in tax cuts that the No Turning Back group proposes. The priority needs to be to equip Britain for the future.

Why are valuable jobs being cut in Revenue offices in objective 1 areas—which are, by definition, deprived—in Wales? At the same time, jobs are being moved to Cardiff, Swansea and Wrexham, which are prosperous areas where the labour market is tight. What is the sense of that?

I remind the hon. Gentleman that there are 100,000 more jobs in Wales since 1997. It is important to deliver public services as efficiently as possible in Wales as elsewhere. We are relocating jobs through the Gershon programme and the Lyons recommendations to Wales as to every other part of the country. However, it is vital that we deliver services as efficiently as possible.

Given that yesterday the Chancellor set out massively increased borrowing requirements for the Government over the next five years, has the Gershon report failed to achieve savings or is it some other failure by the Treasury that requires every family in the UK to borrow an extra £10,000 in the next five years to support the Government’s public spending programme?

We will meet our fiscal rules over the cycle. We do not support a third fiscal rule, as the hon. Lady may. However, the Gershon programme is delivering the savings that it was designed to produce—£21 billion in the current spending review period. Yesterday, we set out an ambition to release £26 billion over the three years of the comprehensive spending review, thus making a big contribution to value for money for taxpayers.