Outsource back office, Gershon tells Tories

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Former head of the Office of Government Commerce Sir Peter Gershon has advised the Conservatives to outsource all back office processing functions within 18 months of being elected.

Gershon, who has joined the Conservatives' public sector productivity panel, said that "a new government should focus on better management, not more IT".

"Six years ago, my own efficiency review highlighted the scale of the government's back office and the major opportunities for savings without harming frontline public services," said Gershon in a statement published on 29 March 2010 alongside Conservative plans to cut the cost of government.

He said that in 2009, the government's latest efficiency review had identified £18bn of spending on the back office and showed case studies where the private sector saved 35 per cent to 70 per cent, adding: "The pace of improvement in the public sector back office has been too slow in the last six years and there has been too much resistance to involving the private sector.

"A new government faces a massive and complex agenda of driving savings to close the deficit. It ought to simplify this agenda by deciding that all back office transactional functions will be outsourced within 18 months, unless they can already demonstrate best private sector practice."

In his statement Gershon also said the public sector should "sweat the assets it already has," rather than continue with unjustified projects. "Investment in major new IT projects can be considered again when the benefits of better management have been exhausted," he said.

His comments were published as shadow chancellor George Osborne outlined plans for total savings of £12bn from government spending in the 2010-11 tax year, allowing him to neutralise a planned rise in national insurance contributions for anyone earning less than £35,000.

On advice from Gershon and fellow adviser Dr Martin Read, the Tories have outlined five key areas for cost savings, which includes the halting of IT projects and cancelling any underperforming contracts even if they are underway. Gershon also said that, if elected, the party should negotiate significant reductions in costs from suppliers, and should minimise the use of advertising, lawyers, external contractors and consultants.

This article was originally published at Kable.

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