Conclusions and Recommendations |
1. Government departments are a long way from
achieving full value for money from their office estate. To
achieve better value for money, departments need to achieve greater
consistency in meeting accepted space standards, improving space
utilisation through desk sharing and remote working, realising
opportunities for co-location and relocation, and tackling and
ultimately disposing of inefficient buildings.
2. Departments' buildings are, as a whole,
performing at almost 40% worse than the private sector benchmark
average. Cost and space utilisation is
between 14% to 50% worse than equivalent buildings in the private
sector. If departments brought their performance into line with
private sector averages they would achieve gross savings of around
3. Departments lack key information to manage
their office property effectively. Accurate
data on building location, costs, occupation density and day to
day occupation level are necessary for the proper understanding
of performance. Departmental property asset management boards
should routinely collect, validate and use such information to
benchmark performance and tackle underperformance.
4. Only five out of sixteen departments had
developed asset management plans as required by December 2007.
Without strategic leadership and proper
accountability, progress in achieving better value for money will
be limited. Property performance should be a standard item for
consideration at departmental board meetings. Departments' annual
reports should set out progress in meeting property standards
and realising efficiency improvements, together with clear explanations
where significant variances remain.
5. Departments do not have data on the level
of energy consumed for three out of ten government buildings.
Metrics covering energy consumption, the proportion of energy
from renewable resources, recycling and the quantity of water
consumed are important for identifying opportunities to improve
both value for money and sustainability. Departments need to seek
assurance, drawing on expert opinion, that their building performance
metrics, including sustainability, are sufficiently comprehensive
and fit for purpose. Departments must also be confident that responsibility
for taking action where metrics highlight potential for improvement
is clearly defined and understood.
6. Departmental buildings in London have the
highest accommodation cost at £507 per square metre and the
North East the lowest at £133 per square metre. While
relocation can incur implementation costs such as redundancy payments
and dilapidations on surrendered leases, departments can achieve
cost savings by locating in less expensive regions. Departments'
asset management plans should explicitly consider the business
case for relocation and challenge preconceptions that staff have
to be based in London.
7. The High Performing Property initiative
has potential to improve value for money but requires more active
participation from departments. Launched
by the OGC in November 2006, the initiative encompasses a range
of actions to improve the cost effectiveness of government buildings.
Its success will depend, however, on the full commitment of departments.
It will also depend on OGC making greater use of its remit to
set standards, as well as monitoring and challenging departments
on key performance metrics such as the application of space standards.
8. The OGC needs to be clearer as to how the
£1 billion to £1.5 billion efficiency savings will be
achieved. The success of High Performing
Property depends on achieving significant efficiency improvements.
There is, however, little detail on the specific source of expected
savings. OGC needs to develop a more detailed assessment of the
make up of the efficiency improvements, together with a robust
approach for measuring and reporting them.
9. The Treasury was the worst performer in
2005-06. The Treasury had the highest
accommodation cost per person at £12,041, the highest space
allocated per person at 21.9 square metres per person and the
third highest cost per person at £529. The Treasury has taken
some steps since to improve performance but still has excess capacity
in its main building and needs to set a better example to the
rest of government. The Treasury should further improve space
utilisation by accommodating more staff to fully utilise existing
buildings at optimum levels, and implement flexible working policies
and practice to further improve space efficiency.