Improving Government’s Planning and Spending Framework

Summary

HM Treasury has, these many years, demonstrated that it is highly effective at controlling public spending. It has, relatively recently, turned its focus towards a renewed drive to improve value for money. There have been positive developments in this direction, not least the Barber review, the provision of specialist advisers to the spending teams and more. Likewise, the Cabinet Office has been working to improve the maturity of business planning across departments.

However, there are occasions when we see value for money being compromised by the needs of short-term spending control. Unrealistic, over-optimistic budgets are kept within the spending envelope by short-term unplanned cuts, which can damage long-term programmes and drive suppliers to distraction.

All this turbulence can only be minimised by integrated medium- and short-term planning activity, strongly policed and challenged for realism and deliverability by the HM Treasury spending teams, and supported by the Cabinet Office and the civil service functions. This may require different skills and a significant change in mind-set both at the centre of government and in departments. Without these changes, government will continue to be trapped in a cycle of short-termism, over-optimism and silo decision-making, which creates real risks to value for money.

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