Some parts of government could be more ambitious with their efficiency plans, National Audit Office boss Gareth Davies has suggested.
At the 2025 Spending Review in June, each government department identified "at least 5%" in total savings and efficiencies to be achieved over three years to 2028-29, with these funds to be repurposed for core priorities.
Davies was asked about the 5% commitment during a Q&A session following his annual speech as comptroller and auditor general on Tuesday. He replied that while the most recent plans are "more thoroughly thought through and more soundly based" than previous versions, the potential for savings from improving business processes and applying new technology means government "ought to be doing a lot more than 5%".
Jon Watts, chair of both the Foreign, Commonwealth and Development Office and Environment Agency’s audit and risk assurance committees, asked if departments should be “going further, faster”.
Davies said he had “a lot of sympathy” with Watts’ argument “about the level of ambition and pace”.
The NAO boss added that the SR25 efficiency plans are “more thoroughly thought through and more soundly based than previous efficiency plans, although that is a low bar”.
“But they have been worked on pretty hard and I think that we will be looking at their implementation pretty thoroughly, because we think they're worth taking seriously and worth holding to account on,” he said.
“But is it enough? Organisations in other sectors are, of course, achieving a lot more, a lot more quickly."
Davies said he would "resist slapping a 20% challenge on every bit of government" but that in some cases, even more than 20% could be achieved.
"I know this was a challenge through the spending review, but making sure that the challenge here is appropriate to the opportunity in each case, rather than around an average, I think is a really big one," he added.
NAO chair Dame Fiona Reynolds added that David Goldstone, who was in attendance at the event, should get credit for his work as chair of the now-closed Office for Value for Money “for helping make those spending plans more secure and more profound" and "an excellent starting point" for greater ambition in future plans.
Responding to the SR25 efficiency plans just after they were published in June last year, Davies said departments would need to ensure that the efficiencies "represent genuine improvements as opposed to spending cuts", and would need to develop clear plans to support targets, and ensure rigorous follow-up of progress to achieve "sustainable" efficiencies.
He added: "The ultimate test of departments’ plans will be their ability to deliver against these welcome efficiency commitments. We have seen too often in the past that planned efficiency savings fail to materialise.”
Davies' speech on Tuesday focused on the importance of good quality financial management in unlocking better value for money for the government. He said better financial management capability is needed if the government wants to deliver “real efficiency improvements" and that this is about expertise rather than headcount.
CSW has approached the Treasury for comment.