Public Expenditure: Cost Effectiveness

At Autumn Budget, we launched the Office for Value for Money to realise benefits from every pound of public spending. The Chair of the Office for Value for Money will advise the Chancellor and I on decisions for the Spending Review. This will include an assessment of how to root out waste and inefficiency, value for money studies in high‑risk areas of cross‑departmental spending, and scrutiny of investment proposals to ensure they offer value for money.

At launch of Phase 2 of the Spending Review, I asked each department to carry out a line-by-line review of existing day-to-day budgets, last undertaken 17 years ago, to identify where spending is no longer aligned with this government’s priorities or is poor value for money.

Building on the 2% productivity, efficiency, and savings target the government set departments in Phase 1 of the Spending Review, departments are expected to identify a minimum of 5% savings and efficiencies against their current budgets freeing up funding to achieve the government’s priorities.