Government vows to take actionover 'staggering' Whitehall waste

Sir Philip Green, the owner of Topshop and Bhs, told Ministers they could save hundreds of millions of pounds by cutting swathes of waste from spending on everything from coffee and hire cars to mobile phones and computers.

Examples of the “staggering” amount of money being wasted included expensive printing of leaflets, spending up to 117 a night on hotels, 73 on a box of paper while other departments spent 8, and the 2 billion a year telecoms bill which Sir Philip said could be cut by up to 40 per cent.

The report revealed that vending machines and staff cafs in Whitehall were operated by at least eight different companies through 16 different contracts, with the the price of a cup of coffee ranging from 1.45 to 90p, a 38 per cent difference.

Sir Philip recommended that civil servants should apply the same principles to buying goods and services as if they were spending their own money.

The self-made billionaire retailer said multiple contracts had been signed with major suppliers by different Whitehall departments at different prices.

The Government was the biggest tenant and property owner in the country, yet the use and management of space was “wholly inefficient”, said his report.

Sir Philip also complained that expensive computer services were contracted out for too long with no flexibility.

He found during his investigation that the Government acted as a series of independent departments rather than one organisation, with no motivation to save money, no process for challenging budgets and inconsistent commercial skills among staff.

Figures on procurement were described as “shocking”, with Sir Philip finding information hard to get at, although he identified huge price variations across different departments for common items.

The report revealed that the Government had missed an opportunity to save 20m by breaking the lease on a central London property which was costing 5m a year to rent.

In another case, a Government agency wasted 15m in property rent in west London, while a different agency relocated from London to the Midlands, signing a 20-year lease on a building with no break for 15 years, only to be abolished after nine months, wasting 18m. In just one Government department, 119 properties were surplus to requirement, said the report.

Sir Philip found there were 71,000 Government “buyers” with a monthly spending limit of up to 1,000, which was not monitored, even though the total amount being spent was around 1 billion.

Prime Minister David Cameron at a Press conference at 10 Downing Street, described some of the report as “pretty chilling reading”.

“Under the last government, the sluice gates were opened, the money was spent and there weren’t nearly enough questions asked about how can we purchase better, save money, find efficiencies.”

The Prime Minister’s spokesman said later of the report: “We are going to implement what he says.”

Comment: Page 10.