Office for Value for Money

Harriett Baldwin Excerpts

Monday 20th January 2025 Commons Chamber

[Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

It gives me great pleasure to make a statement on the first report of the Treasury Committee in this Parliament, and I again thank the House for giving me the honour of occupying this position. Our first report is on the new Office for Value for Money.

There will not be a single Member who does not believe in value for money for our constituents, who pay for Government services through hard-earned taxes that they give grudgingly to be spent well. As the Chancellor herself has been very clear, the taxpayer is not an automatic cash machine and every penny of taxpayer money needs to be spent as well as possible. The notion of value for money is one we would all support. We also need transparency, and that is a large part of the role of Select Committees: to shine a light on Government actions. This is our first public report shining a light on the work of the Treasury.

The Office for Value for Money is a short-lived, year-long body that is expected to have 20 staff, including secondees from the National Audit Office and the evaluation taskforce in the Cabinet Office. It is headed by a chair, who told us that it would conduct a small number of studies mainly on a cross-departmental basis to identify better value for money across Government. When we spoke to the chair in our hearing at the end of December, we found that although it was supposed to have 20 members of staff, it only had 12 and all were below director-general level, so not the most senior civil servants. That total of 12 and the ultimate total of 20 will include secondees.

It had not ruled out in December using external consultants to bolster the skills it will need to deliver on its work. It had not yet decided at the end of December into which areas it would launch studies, and nor had it set the parameters for evaluating its effectiveness. The Committee was clear that having a body with a name we would all agree with the principle of is not enough; we want to see such a body deliver for our constituents.

We highlighted in our report that there is a risk of duplication. There are already a large number of bodies across Government that deliver on value for money, scrutinise Government, and shine a light on how money is spent: the National Audit Office, which has nearly 1,000 staff in Newcastle and London; the evaluation taskforce in the Cabinet Office, which evaluates projects across Government to make sure they are properly delivering; the new National Infrastructure and Service Transformation Authority, which will be operational in the spring and brings together the previous Infrastructure and Projects Authority in a slightly different format.

There are also units in Departments that work to deliver on value for money in a range of areas, in particular the new arrangements for the Department for Science, Innovation and Technology, with its centre for digital transformation of public services. The Cabinet Office also has a readiness programme, based on regulations arising from the Procurement Act 2023, called “Transforming public procurement”.

There is also the rainbow of books. If we walk into the Treasury and ask questions about the green book, the teal book and the magenta book—and there are others—we will learn that is an important infrastructure for how it issues guidance. The green book appraises policies, programmes and projects. The teal book provides guidance on project delivery in Government, including managing projects, programmes and portfolios—that has been in an internal trial since July 2024. The magenta book provides Treasury guidance on what to consider when designing evaluation.

There are also a number of frameworks, including the Government efficiency framework and the public value framework. Datasets are also provided, including the priority outcomes and metrics first set out in the spending review of 2020. One of the most crucial elements in delivering value for money is that every Department has outcome delivery plans addressing the meat and drink of what is going on in Government. As Secretaries of State sit and plan what they might have to deliver in the spending review coming up in June, they will be poring over those outcome delivery plans as they do their departmental review; each Department will have its own review to look at where money is being spent and what projects are being delivered.

Overarching this there is “Managing public money”, which covers the approach of all permanent secretaries, who are the accounting officers and are therefore responsible for answering for how taxpayers’ money is spent through the accounting processes of Government. Their accounting officer assessments have to fit in with that regime.

We all want to see value for money, but this young body is one-year long and is not yet well established. The risk of duplication is high, and we need to ensure that it delivers something special and different, and crucially that nowhere in the Office for Value for Money will Ministers be playing a role. They will have a key role in delivering on the spending review, but in my experience of over a decade of scrutinising public spending, Ministers can make promises but they are not always well delivered, which can drive up public spending if we are not careful.

It is vitally important that this body delivers as set out, so we have asked the Treasury to explain in more precise detail what it expects the Office for Value for Money to deliver, how it will evaluate its success, and what it wants to see in the long term from this body chaired by David Goldstone. We wish this body well, but the Committee is clear that at the moment there are a number of areas of concern about whether it will actually deliver what it is set out to do.

[Dame Harriett Baldwin (West Worcestershire) (Con)]

I congratulate the hon. Lady not only on her excellent chairing of our Committee and this report, but on securing a slot in the Chamber to tell people about some of the report’s recommendations. Her background as the former Chair of the Public Accounts Committee gives huge credibility to the points she is making about the possibility that this new and temporary body will not be able to make its mark in the way the Government hoped. One of the areas where my constituency has benefited most in value for money from public spending is flood defences. With her long experience, does she agree that protecting our communities from the impact of climate change is one of the best uses of public money?

[Dame Meg Hillier]

The hon. Lady, the former Chair of the Treasury Committee—she still serves on the Committee—highlights a pertinent point. The chair of the Office for Value for Money said that it is not just about cash costs and that sometimes it might want to look at programmes that will save costs in the long run. However, that was still ill-defined, and we need to hear more detail, because that is the holy grail, really. If we can spend to save, that benefits our taxpayers in the long run in cash and, in the case of flooding in particular, it prevents something that is catastrophic for many communities.