Sir Philip Green shows just where Whitehall is wasting billions

THE government has pledged to implement a series of recommendations on cuts in Whitehall after a damning report revealed departments have needlessly cost the taxpayer billions of pounds in waste.

• Sir Philip Green pinpointed scope for savings

In an indictment on government spending Sir Philip Green, the boss of BHS and Topshop said that there was "no motivation" for departments to treat cash as their own and there was a lack of skills to manage resources properly.

Sir Philip, who was asked to draw up a report into government waste by Prime Minister David Cameron, told ministers they could make swathes of cuts from public services after uncovering a "staggering" waste of money.

In the 33-page report, Sir Philip said: "Having carried out this review and discussed it with the senior civil servants I have worked with, they all believe it is impossible for the civil service to operate efficiently with the current processes in place."

Sir Philip identified huge savings to be made in communications, hire cars, the purchase of computers and other goods and services, and in catering and hotel charges.

He said the previous Labour government had missed an opportunity to save 20 million by breaking the lease on a central London property that was costing 5m a year to rent.

The report revealed that a government agency wasted 15m in property rent in west London, while another agency relocated from London to the Midlands, signing a 20-year lease on a building with no break for 15 years, only to be abolished after nine months, wasting 18m. In just one government department, 119 properties were surplus to requirement.

Sir Philip said vending machines and staff cafs in Whitehall were run by at least eight different companies operating 16 different contracts, one for each department. The highest price for a cup of coffee was 1.45, whereas the lowest stood at 90p, a 38 per cent difference.

He suggested departments could save 30 to 40 per cent of the annual 2 billion spent on telephones it the government bought its own capacity.

Amid the cost differentiation between departments he pointed out that one paid 1.31 per sheet for printing, while another spent 26p, 80 per cent less.

Sir Philip said: "There is no reason why government should not be as efficient as any good business.

"Any large organisation would want to use its credit rating and scale to buy efficiently. The conclusion of this review is clear - credit rating and scale in virtually every department has not been used to make government spending efficient."

Mr Cameron said it was a "solid" report that identified how much money had been wasted, and pledged to bring in the report's recommendations.