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Efficiency, Reform and Growth (ERG), established in 2010 as the Efficiency and Reform Group, is part of the Cabinet Office which works in partnership with HM Treasury to form the corporate centre for UK Government. Its objectives are to reform the way government works and to support the transformation of government services by both driving cost savings and focusing on growth to build a platform to enhance public services.
The group is led by the Chief Operating Officer for Government, Stephen Kelly. The group reports, through the Permanent Secretary of the Cabinet Office, Richard Heaton, to the Minister for Cabinet Office, Francis Maude, as well as to the Minister for Political and Constitutional Reform, Chloe Smith and the Minister for Civil Society, Nick Hurd, who have specific responsibilities for parts of ERG work. ERG also work closely with the Chief Secretary to the Treasury, Danny Alexander.
ERG works with government departments to identify common areas for savings. These savings are achieved through four main approaches: aggregation - combining spend across government departments in common areas to achieve the best price for government as a whole; standardisation - bringing government departments onto shared systems such as ICT; expertise - providing a centre of expertise to help departments with operational and commercial probelms and reducing demand for inefficient spend in areas such as advertising and consultancy through a spending controls mechanism. It aims to help government departments to deliver at least £20bn of efficiencies in the financial year 2014-15.
The UK had one of the biggest budget deficits in the world when the Coalition government came to power in May 2010. The government took the decision to make reductions to central government expenditure to enable fiscal consolidation, reducing expenditure by c£80bn by 2015.
The government created the Efficiency and Reform Group in June 2010 in central government with the aim of carrying out a well planned and considered strategic programme of efficiencies, savings and reform, leading to targeted cost reduction and the transformation of public services. It was first established by Ian Watmore, the first Chief Operating Officer of ERG, who went on to become Permanent Secretary of the Cabinet Office until May 2012.
Ways of working
- Corporate - The Corporate cluster provides a strategic overview for the group, as well as measurement of its processes and successes. This cluster is reforming government management information, driving a clear, evidence based approach to efficiency programmes across government. It also has oversight of a system of Cabinet Office spending controls where government departments need to come to Cabinet Office to get approval for certain levels of departmental spend. This cluster is led by Katharine Davidson, Executive Director of Strategy and Management Information.
- Efficiency - The Efficiency cluster’s central focus is delivering back-office savings to protect key frontline services by ensuring that government acts as one customer. ERG achieves this by consolidating government’s buying power on commodities, increasing the number of suppliers to government (including SMEs) and procuring more quickly using lean techniques. ERG looks at common cross-cutting opportunities from which savings could be driven, standardising systems such as ICT and reducing demand in areas like advertising and property. This cluster is led by Bill Crothers, Government Chief Procurement Officer.
- Transformation - The Transformation cluster focuses on fundamental transformation of public services in order to bring about significant improvement and sustainable savings for government. This includes the transformation of the Civil Service as set out in the Civil Service Reform Plan. ERG, with the support of HM Treasury, aims to deliver a set of shared programmes designed to support departmental transformation. These programmes aim to radically change the way public services are delivered—improving customer experience and value for money. A key exemplar of this approach is the Digital Strategy—aiming to make government services digital by default and easier for the user. This cluster is led by Mike Bracken, Executive Director of Digital, and Ed Welsh, Executive Director of Commercial Models.
- Growth - The Growth cluster oversees a number of targeted programmes, making use of a cross-cutting view of central government, which aim to support growth in the UK. This includes improving procurement methods to allow a wider range of UK businesses (including SMEs) to bid for government contracts, making new partnerships and businesses through public service mutuals and encouraging social investment and social action. This cluster is led by William Jordan, Executive Director for Growth and Departmental Engagement.
- Projects - The Projects cluster is driving value by providing expertise on assuring the most significant projects in government. This includes the Major Projects Authority, which works, under a mandate from the Prime Minister, to ensure that government’s major projects are delivered on time, within budget and to quality. The cluster will ensure that significant projects deliver on budget and, where prudent, will work with departments to identify inefficient spend, quickly stop failing projects or reduce expenditure through de-scoping and thorough risk management. This cluster is led by David Pitchford, Executive Director of the Major Projects Authority.
- £3.75 billion of savings were made by departments supported by ERG in the last ten months of 2010-11. Francis Maude, Minister for Cabinet Office commented that this is “equivalent to the salaries of 200,000 junior nurses; or 150,000 secondary school teachers; it could pay for several Whitehall departments; and it’s about the same as the revenue derived from one penny of the basic rate of income tax”.
- £5.5billion was saved by departments, supported by ERG, in efficiencies in 2011-12. This is equivalent to “around £500 per working household in Britain; the salaries of around 250,000 junior nurses; or the cost of around 1.6 million primary school places”.
- My Civil Service Pension - the first central government public sector mutual joint venture, created in May 2011, which led to increased employee ownership. ERG is committed to the creation of a market of different types of commercial models in central government. These new models aim to provide significant and sustainable improvements in quality and productivity, and drive efficiency savings. This leads to the creation of new business and directly drives growth in the UK economy.
- GOV.UK - As part of the digital strategy, GOV.UK was formed as a single website for all of government in November 2012. The websites of central government departments and other organisations will gradually move to GOV.UK, so that when completed, it will be possible to find all government information in one place. 83,000 URLs have been merged to form one website.
- Major Projects Authority - The MPA is a partnership between the Cabinet Office and HM Treasury. It has a mandate from the Prime Minister to oversee and direct the effective management of all large-scale projects that are funded and delivered by central government. The MPA scrutinises projects, ensures accountability and informs the Treasury’s decisions on whether to approve projects 
- Procurement reforms - ensuring the supply chain to government is more diverse, explicitly changing processes to support SMEs in bidding for government contracts. SMEs are more innovative and will often deliver more cheaply with a greater outcome than the biggest suppliers. In ICT, procuring hosting services through an SME reduced costs by almost 99%
- Property rationalisation - the Government Property Unit (GPU) in ERG runs the program to rationalise the government’s property portfolio. In order to reduce its annual spend on property, GPU has reduced the number of locations occupied by government workers. This is being achieved by disposing of non-core leasehold and freehold buildings; implementing more flexible ways of working; and consolidating and co-locating workers in underused buildings. From May – October 2012, the government has exited over 1.2 million sq m and reduced the size of its estate by 12%. That is equivalent to the size of 174 Wembley pitches or more than 14 times the size of the new Shard building.
Interim results show departments have saved £3.1 billion so far this financial year and are expected to save more than £8 billion by end of the year in 2013. The ERG aims to help government departments to deliver at least £20bn of efficiencies in the financial year 2014-15.
- ↑ Efficiency and Reform Group Cabinet Office
- ↑ The Efficiency and Reform Group’s role in improving public sector value for money National Audit Office
- ↑ Stephen Kelly succeeds Ian Watmore as government chief operating officer The Guardian 18 September 2012
- ↑ Richard Heaton becomes part-time Cabinet Office permanent secretary The Guardian 6 August 2012
- ↑ Francis Maude, Minister for the Cabinet Office Cabinet Office
- ↑ Chloe Smith, Parliamentary Secretary Cabinet Office
- ↑ Nick Hurd, Minister for Civil Society Cabinet Office
- ↑ Chief Secretary to the Treasury: Rt Hon Danny Alexander MP HM Treasury
- ↑ 9.0 9.1 Cabinet Office Controls Guidance Cabinet Office
- ↑ Francis Maude quadruples Whitehall savings target to £20 billion The Telegraph 9 August 2012
- ↑ Spending Review 2010 (PDF) (October 2010). Retrieved on 10 December 2012.
- ↑ 12.0 12.1 Executive Summary of The Efficiency and Reform Group's role in improving public sector value for money Public Accounts Committee
- ↑ Ian Watmore resigns as permanent secretary in Cabinet Office The Guardian 16 May 2012
- ↑ Government Procurement Service website
- ↑ Civil Service Reform Plan (PDF) (June 2012). Retrieved on 10 December 2012.
- ↑ 16.0 16.1 Liam Maxwell: user need underpins the government's digital-by-default strategy The Guardian 14 November 2012
- ↑ 17.0 17.1 Government Digital Strategy (PDF) (November 2012). Retrieved on 10 December 2012.
- ↑ Major Projects Authority Cabinet Office
- ↑ Coalition cuts have saved £3.75bn in eight months, says Francis Maude The Guardian 1 August 2011
- ↑ Francis Maude reveals £3.75bn in savings Cabinet Office
- ↑ Whitehall cuts save £5.5bn The Independent 9 August 2012
- ↑ Francis Maude reveals further savings that beat expectations Cabinet Office
- ↑ Lord Hutton to chair mutual partnership in charge of civil service pensions The Guardian 30 April 2012
- ↑ Gov.uk launches one UK government website to rule them all Financial Times 1 February 2012
- ↑ Anna Shipman, Testing the redirections Government Digital Service, 10 December 2012
- ↑ Autumn Statement promises new Major Projects Authority role Kable Government Computing 5 December 2012
- ↑ Government Property Unit Cabinet Office
- ↑ Government claims £100m Whitehall property savings The Guardian 12 January 2012
- ↑ Hold our feet to the fire over efficiency in government The Guardian 6 November 2012
- Cabinet Office official webpage
- HM Treasury official webpage
- Government Procurement Service official webpage
- Government Digital Service official webpage
- MyCSP official webpage
- GOV.UK webpage
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