Planning across Government
"The roles and responsibilities in central government’s planning and spending framework are threefold:"
"- Departments, led by accounting officers, plan and deliver their objectives and they are accountable for their delegated budgets."
"- HM Treasury is responsible for allocating and controlling public spending; scrutinising and approving project and programme spending outside of departments' delegated limits and novel and contentious proposals, with the aim of delivering value for money. It delegates budgets to departments; and sets rules for government financial management. Its 20 spending teams advise HM Treasury ministers on decisions at spending reviews; review and approve submissions for new spending on projects and programmes; and monitor departments' budgets and spending risks."
"- The Cabinet Office monitors delivery of departments’ objectives and government policy priorities and oversees departmental business planning."
Risk of over-optimism
"spending teams do not routinely monitor departmental performance against an agreed set of objectives."
"a risk that departments and HM Treasury are complicit in agreeing over-optimistic delivery or spending reduction plans that have no realistic chance of being delivered."
Silos against good planning
"government’s structure of departments, with separate accountabilities, leads to business planning and spending review submissions being created in silos."
Realism of analysis
"Not all business plans integrated activity planning with resource planning."
Planning maturity issues
"there was no business case, no clear statement of intended objectives and outcomes, and no plan covering the full duration of the programme."
"When identifying potential risks, spending teams focus mainly on in-year and medium-term spending risks – our review of a sample of risk registers showed they rarely flagged balance sheet risks that have no short-term effect on spending."
"Our analysis of risk registers maintained by spending teams showed they focus on spending risks rather than value for money, and there was limited reference to the risk of not delivering the expected outcomes or benefits."
"At the root of this problem lies not only poor data on costs and performance, but also inconsistent challenge, both within departments and by the centre of government."
"Parliament has also made clear that it wants greater visibility of government’s spending choices, but traditionally only details of the outcomes have been published, whereas details of how decisions are reached have not (paragraphs 1.6, 4.10, 4.13, 4.16 and 4.17 and Figure 24)."
Capacity and capability not taken into account
"While survey respondents felt that criteria used by their departments for making decisions about priorities had improved (Figure 9), only 53% said their department accurately aligned planned deliverables with capacity and capability (Figure 15 overleaf)."
This report reviews government’s progress in improving the planning and spending framework since we last reported in July 2016,2 and the way in which HM Treasury and the Cabinet Office have sought to address the systemic issues around planning and spending decisions that we have identified in our work across government. We set out:
- the current planning and spending framework and the approach to long-term planning (Part One);
- the evolution of medium-term business planning (Part Two);
- the evolution of HM Treasury’s approach to managing spending in the short term (Part Three); and
- the challenges for the 2019 Spending Review and beyond (Part Four).