Government: Savings

Lord Sassoon Excerpts

Thursday 24th June 2010 Lords Chamber

[Lord Eden of Winton]

To ask Her Majesty’s Government what savings are being made in the administration of Government.

[The Commercial Secretary to the Treasury (Lord Sassoon)]

My Lords, the Government have announced savings in the current financial year of £6.2 billion, of which £360 million will be made in the administration budgets of central government departments, and £400 million will be made in the administrative costs of quangos. The Government have also announced in the Budget £3.3 billion of savings from freezing public sector pay for two years from 2011-12 for those earning above £21,000. A portion of these savings will be made within administration budgets. The Government are committed to reducing the administrative costs of Whitehall and of arm’s-length bodies by at least one-third. Further details and spending plans will be set out at the spending review on 20 October.

[Lord Eden of Winton]

That was a good Answer. I suspect that there are masses of people like me who are fed up with the monitoring, hectoring and intrusion by government agencies and quangos. Can my noble friend confirm that every department has been required critically to examine the justification of and the value for money of every activity in which they are engaged? Can he confirm that they have been given a clear timetable by which to report, and is he able to say what will be the likely impact on front-line services of any subsequent cutback?

[Lord Sassoon]

My Lords, I want to read some words that my noble friend may recognise:

“I am most concerned about the people who are hardest hit ... They have been trying to deal with their own responsibilities themselves, and … to take the burden off the State and look after themselves. The wasteful money-spending policy of the Socialist Government has virtually ruined their little nest eggs”.—[Official Report, Commons, 13/3/55; cols. 2158-59.]

Those are the words of my noble friend in another place some 55 years ago, so I applaud him for the consistency of his concern that the size of the public sector be reined in. It reminds your Lordships that such reining in has, regrettably, had to be done in the wake of successive Labour Governments. Therefore, this time round, I can absolutely confirm everything that my noble friend asked for. In particular, we will ensure that departments completely meet their commitments on reducing admin spend. This, as I said, will be done by a cut of at least one-third, which is committed so far. That is a starting point and we may look to go further.

[Lord Brooke of Alverthorpe]

Can the Minister say whether the Palace of Westminster is classed as one of the arm’s-length bodies? Will there be a savings of one-third here? What plans does he have for implementing them and what is the timetable? If he does not have such plans, can he explain why?

[Lord Sassoon]

My Lords, I have not been here very long but I know that I would be foolish to get into off-the-cuff answers on admin costs for the Palace of Westminster. Rather than waste time giving the noble Lord a definition of what is included, I shall write to him.

[Lord Newby]

Will the Minister ensure that, when looking for savings, he does not only do so within departments but seeks to reduce duplication of function between departments and quangos by implementing the principles of the Total Place programme more generally across government?

[Lord Sassoon]

My Lords, I thank my noble friend for that; we will indeed look right across government in the way that he suggested. The definition of what constitutes admin costs will itself be considered in the spending review and reported at that time.

[Lord Pearson of Rannoch]

My Lords, did the noble Lord see the recent article in the Daily Telegraph which estimates that up to 2,000 Eurocrats are paid more than the Prime Minister? Why do we go on sending some £8 billion in cash every year to support these people, who then go on to inflict such ruinous over-regulation on our economy?

--- Later in debate ---

[Lord Sassoon]

I thank the noble Lord for his concern about the costs of bureaucracy in Brussels, about which we, too, are of course very concerned. The Government will be taking steps to make sure that the budget contribution to Europe fully reflects the need for Europe to restrain its costs. So far as concerns Eurocrats, we want to make sure that the best-quality British officials play their part as senior officials in Brussels.

[Lord Morris of Aberavon]

My Lords, what is being done to reduce the number of civil servants of the rank of Permanent Secretary in the Cabinet Office and Downing Street, of whom there are six in number?

[Lord Sassoon]

My Lords, while there are those six Permanent Secretaries in addition to the Permanent Secretaries in each department, we have over 600,000 civil servants in total. The main question is how we reduce the total number of civil servants, which increased by 28,000 under the previous Government.

[The Lord Bishop of Bath and Wells]

My Lords, while recognising the need for child protection and health and safety matters, will the Minister also recognise that at present over 4 million volunteers are being lost to the system due to what one might describe as overzealousness in these areas? Can serious attempts be made to focus on what is absolutely essential in these matters, rather than on that which seems to be ongoingly pervasive?

[Lord Sassoon]

I thank the right reverend Prelate for that question. I would stress that by having a target of a one-third reduction in administration costs, which we hope to exceed, we will be able to target the expenditure on where it really matters, including in the ways that he has described.

[Lord Marlesford]

My Lords, given that the cost of compliance with government regulations by the business sector is tax-deductible and therefore a net cost to the Exchequer, will my noble friend seek to bring under better control some of the quangos whose regulatory functions appear to lack both proportionality and common sense? Will he ensure that if they are to continue at all, they are brought under much tighter discipline?

[Lord Sassoon]

I simply confirm that that will be done, in line with my noble friend’s suggestions.

[Lord Maxton]

My Lords, is not the introduction and development of smart-card technology for all our citizens the best way of improving the quality and reducing the expense of public services generally? If that is so, why on earth are this coalition Government abolishing the ID card programme?

[Lord Sassoon]

It is a waste of money, my Lords.