The committee had looked at evidence from the Cabinet Office, the Department for Education and the Department for Work and Pensions at previous attempts to save money and welcomed the coalition government's renewed focus on improving shared services – driven by the Cabinet Office's "ambitious new strategy". However, there were risks involved and there was "a particularly challenging timetable for implementation".
The Public Accounts Committee (PAC) has found that five government shared services centres cost a total of £1.4bn to set up, £500m more than expected and in some cases cost more than the expected saving.
In its report on efficiency and reform through shared services, the PAC says that the five centres were expected to have saved £159m by the end of 2010-11. It found, however, that the Ministry of Justice centre broke-even, and the Department of Work and Pensions and the Department for Environment, Food and Rural Affairs centres did not track their total savings.
Read more: GB: Shared services go £500m over budget, MPs say
The UK’s IT skills shortage is in danger of becoming even more severe, with a record numbers of vacancies.
According to eSkills UK, a non profit organisation related to the quango UK Commission for Employment and Skills, the UK needs to produce 129,000 new recruits to fill the vacant IT jobs each year.
The numbers of vacancies has been climbing quickly overall, up from 82,000 a quarter in 2009, to 116,000 per quarter.
The Rt Hon Margaret Hodge MP, Chair of the Committee of Public Accounts, today said: "Government could save significant sums of money if it pooled back office functions such as finance, HR and procurement. Securing efficiency savings is essential to protect public services from further cuts that could otherwise have been avoided.However, shared service centres have failed to deliver the savings they should have. They cost £1.4 billion to set up, £500 million more than expected, and in some cases have actually cost the taxpayer more than they have saved.I welcome the Cabinet Office's ambitious new strategy for improving shared services. But unless it learns from the past it will end up making the same mistakes again.In particular the Cabinet Office must show much stronger leadership. In the past it has left it up to individual departments to decide whether they use shared services. Departments which do use shared service centres have been allowed to stick to their own ways of working rather than using a single system suitable for all, undermining the scope for efficiency savings.It is extremely frustrating that the Cabinet Office has ignored recommendations made by this Committee in our previous reports. We expect it to engage constructively this time around."
Government departments have saved around £1.3m during the past year from adopting greener ICT practices, such as improving the energy efficiency of server rooms and replacing business travel to meetings with videoconferencing.
That is one of the key findings of the Cabinet Office's first annual progress report, Greening Government: ICT Strategy.