Sunday, September 27, 2009

Not living in the real world.

This is something I've long suspected from my (admittedly few) dealings with government departments. It's the idea amongst the people that work there all the way up to the top of not knowing the cost of anything. Whether it's the MOD overspend on military equipment that they could buy cheaper off the shelf (including kit items that the troops immediately discard and buy better stuff for themselves), to the Home Office spending £1000 each on a single chair to avoid back strain for everyone who works there.

Seems every department is in on it.

Millions of pounds of taxpayers' money is being wasted in the Department for Children, Schools and Families, an internal government report suggests.

The report, by former WH Smith chief executive Richard Handover, has been seen by BBC One's Politics Show.

It claims civil servants and head teachers appear to have no idea what value for money means, and calls for 40,000 teaching assistant jobs to go.

Schools Secretary Ed Balls has said £2bn could be cut from his department.

However, last week, he appeared to rule out the sort of job losses proposed by Mr Handover.

In his frank report, Mr Handover states: "Financial efficiency... is not seen as a core responsibility of management at any level."

He described how £50,000 was spent installing three toilets at a primary school - 10 times the required sum, while another spent £35,000 on a £1,000 photocopier.

This is what happens when the people involved are disconnected from reality, because it's not coming from their own pockets they don't see it as real. It's why government I.T. contracts always fail or cost a lot more than the original contract because the people who authorise the expenditure ask the wrong questions or simply do not realise that they'll get exactly what they ask for which isn't necessarily something that will do the job that they want.

In private industry you'll often find that if you need something the first thing your boss will ask is "how much" second will often contain the term "can we get it cheaper" the third often enough is "can we manage without it." It's why companies employ accountants and auditors to keep the costs down and find areas that can be improved. A good company will have this ethos running through all departments and at all levels. This just does not seem to happen in the public sector and it's something that really needs to change. Value for money needs to become a watchword in these hard times, it has in the private sector.

But it's pretty plain to all that the Public sector has a lot to learn and needs to be trimmed back pretty hard to provide value. They really need to go back to basics and realise who provides the money and that the taxpayer too expects value, not excuses.

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