Government tightens up on money

The Treasury is stepping up scrutiny of Whitehall spending as Ministers underscore their determination to hit deficit reduction targets.

The changes were announced by Treasury Chief Secretary Danny Alexander in a speech to the influential Institute for Fiscal Studies think-tank.

He said the coalition had made good progress towards its spending targets for the review period and as a result the UK has been sheltered from the “worst of the storm that continues to affect our eurozone neighbours”.

However, reforms are needed to ensure the plans are not knocked off track by unforeseen costs.

“In an environment of economic uncertainty, with ongoing instability in the eurozone, the UK’s large deficit remains a crucial economic vulnerability,” Mr Alexander said.

Setting out new rules to be enforced from this year onwards, Mr Alexander said: “These are rules have been drawn up with finance directors from across Whitehall, and are designed to fundamentally change and improve financial management across all organisations spending public money.”

He insisted departments’ delegated responsibility for spending could not be “an excuse to hide information, close the books, or weaken financial management”.