"Efficiency" drive costs government millions

LONDON (Reuters) - Blunders in implementing a plan to make big efficiency savings at the Department of Transport through a centralised services system could end up costing it 81 million pounds instead, a report said on Friday.

The department had envisaged saving 57 million pounds by amalgamating support services such as human resources and payroll for bodies such as the Driver and Vehicle Licensing Agency (DVLA) and Driving Standards Agency.

But its plans were over-optimistic, the department could not agree a common set of business practices and the IT system was not properly tested, meaning an “unstable system” was introduced, said the report by financial watchdog the National Audit Office (NAO).

“This project has been a classic case of act in haste, repent at leisure,” said Edward Leigh, chairman of parliament’s Public Accounts Committee to which the NAO reports.

Staff reported that the system would frequently crash, often meaning it did not function for at least a day. Others said when they sought online help for a query, the replies came in German.

“It is disappointing to see a programme which aimed to improve the efficiency and effectiveness of a department leaving it on current projections some 80 million pounds worse off,” NAO head Tim Burr said.

“Departments need to be realistic about the challenges of implementing shared services and to manage suppliers effectively.”

Reporting by Michael Holden; Editing by Steve Addison