14 March 2008
The chancellor and the Treasury are failing to lead by example in delivering value for money, according to a damning report.
The Treasury select committee report published on March 7 found that the Treasury had failed to deliver on many of its value-for-money delivery agreements, which are intended to give further detail about individual departmental efficiency programmes.
The report – The administration and expenditure of the chancellor's departments, 2006-07 – said the Treasury group's delivery agreement was 'disappointing in its failure to fully address the key issues of disclosure, measuring quality of service and the need for external challenge'.
It also noted 'worrying conclusions' of the recent capability reviews of Revenue & Customs and the Treasury.
Committee chair Michael Fallon said: 'The chancellor's departments, which are the engine of government spending, should be able to demonstrate clear progress against their targets.
'Sadly in some areas, such as the value-for-money delivery agreements, we have found them failing to lead by example. If they can't get this right, how can any other department be expected to?' he asked.
The committee's report has also raised concerns about the department's 'slippage on a number of targets'. It found that Revenue & Customs had continued to fail to meet its target of processing VAT receipts and to improve the administration of tax credits.
'R&C appears to be rewarding failure. Complaints about the tax credits system are at the highest level for five years, there has been considerable deterioration in its vast services and yet senior staff have received on average a 60% increase in their bonus payments. These payments appear completely unjustified,' Fallon said.
The committee has also called on the Treasury to explain why its objective for the appointment of professionally qualified finance directors in all government departments by December 2006 has still not been met.
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