The head of the House of Commons spending watchdog has warned that government departments need significant long-term investment to tackle problems in our health, defense and nuclear sectors.
Ms Meg Hillier, chair of the Public Accounts Committee (PAC), warned there was a “lack of forward thinking” from the government.
The annual report outlines what it calls “big trouble” major spending issues that the government must tackle, including poor infrastructure in hospitals, schools and prisons, and skills shortages across sectors.
The report focuses on three themes that the government is recommended to focus on. These include long-term thinking and investing, resilience, and risk management and understanding.
The Labor MP opened the meeting sternly by saying that while some publicly funded projects were successful, she often heard of “projects going awry, deadlines being pushed back and money being wasted”.
“Too often we see funds being misdirected or wasted, not because of corruption but because of groupthink, stubbornness, laziness and a culture that discourages reporting,” she said.
“The government is not doing enough to plan for the long term or provide long-term investment in its policies,” Ms Megh added.
“Not only will this create problems now, but it will leave critical problems in the future.”
So, what problems were found in the report and what suggestions were made?
healthy
The report found that despite record waiting times and delays in surgery, £178.3 billion was spent on the health budget.
Ms Meg found that NHS waiting time targets have not been met for four years and targets for cancer services have not been met for six years, which, combined with an aging population, means more money needs to be invested in treatment and prevention.
Hospital buildings are considered a major problem hampering the modernization of the NHS and impacting productivity.
She pointed out that the maintenance backlog in NHS hospitals was already worth £10.2 billion by 2021-2022, while plans to deliver 40 new hospitals by 2030 were now in trouble due to insufficient funding.
The Department of Health and Social Care has been accused of “plundering” capital budget funds, with a report warning against reducing capital investment to plug day-to-day spending gaps in the future.
educate
Ms Meg warned that due to a lack of long-term investment, more than 700,000 pupils were studying in schools in need of extensive rebuilding or refurbishment, with 38 per cent of school buildings exceeding their original design life.
“The Department for Education lacks sufficient understanding of safety risks in school buildings, including asbestos and reinforced autoclaved aerated concrete (RAAC), to adequately quantify and mitigate these risks,” the report states.
While £9.4 billion of education funding is allocated to cater for special educational needs, many of the 1.3 million school-age children with these needs and disabilities do not receive the support they need.
If left unaddressed, children with SEND will continue to be in a “postcode lottery”, unable to receive the same education as their mainstream peers.
The report said the Department for Education failed to consider the long-term effects of RAAC (reinforced autoclaved aerated concrete) and asbestos.
Despite a request for £4 billion from the Department for Education, HM Treasury has allocated only £1.3 billion for school rebuilding, and the Department for Education is behind schedule in awarding contracts for its rebuilding programme.
defense
The Ministry of Defense has not decommissioned a single nuclear submarine since World War II, although 20 were decommissioned, costing the government £500 million from 1980 to 2017.
The report states that the Department of Defense “has repeatedly made decisions based on short-term affordability, increasing costs and resulting in value for money in the long term,” adding that the Department of Defense “does not have the discipline to balance its budget.”
Other questions and suggestions
Ms Megh said the government had “consistently underestimated the scale and complexity of the reforms necessary to reduce the backlog in the courts”.
Along with health and education, infrastructure is also cited as a major issue for the Ministry of Justice, with the report stating that 500 prison sites are “permanently rendered unusable” each year due to poor conditions.
The report noted that local authorities “face severe fiscal pressures”, with local government spending falling by more than 50% from 2010/11 to 2020/21,
Mrs Meg also raised areas requiring cross-departmental spending, including a lack of specialist skills and replacing outdated IT systems.
According to the report’s findings, the government spent an estimated £980 million on management consultant fees in 2018/19 to fill skills gaps. It added: “Skills deficiencies must be addressed or the delivery of major capital projects will be at significant risk”.
She added that sometimes the scale of failure in disputes such as HS2 or the Post Office scandal was “colossal”, while in other cases the system failed to be flexible and adaptable.
The government has described progress on the restoration of the Palace of Westminster as “extremely slow”, with £2m a week currently being spent on its construction work, although there are no final agreed plans for what the restored palace will look like.
The report is based on the cross-party committee’s review work and Ms Megh’s observations during her 13 years of service at the PAC.
