Friday, 20 November 2009

TaxPayers' Alliance Bulletin - 20th November 2009
 
Overruns on major projects cost £19 billion

Back in 2007, we released "Beyond the Dome", a report studying the worrying tendency of public capital projects to severely overrun their budgets. A new TPA report out today revisits the topic, and calculates that the total net overrun on 240 key Government projects either ongoing or completed in the last two years stands at more than £19 billion, a sum equivalent to over £750 per household in Britain. Amazingly, that total cost includes those projects that managed to come in under budget.
 

The key findings of the report include:
  • 32 per cent of the projects sampled overran, while 24 per cent came in under budget, but those that overrun do so to such a huge degree that the average overrun of the whole sample was a massive 38%.
  • The project to overrun by the most is the NHS National Programme for IT, which is currently £10.4 billion over budget - over 450 per cent.
  • The worst performing department was the Ministry of Justice with 2 projects overrunning by an average of 163 per cent.
  • The best projects were the East and North Hertfordshire Hospital and the Future Joint Combat Aircraft, coming in under budget by a combined £840 million.
  • The best performing departments were the Treasury, the Department for Innovation, Universities and Skills, and the Foreign and Commonwealth Office. Their projects came in under budget on average.
The dire state of the public finances means that any future government will be forced to cut spending. It is essential that a more considered approach is taken to capital projects, and they only go ahead on the basis of a realistic assessment of cost. Even more importantly, they must be managed competently to conclusion. There have clearly been significant failures with many high profile (and many mundane) projects. The evidence for this is all too clear, with reports from the National Audit Office and the Public Accounts Committee consistently criticising public sector project management.

Coverage of the report includes:
 
Daily Mail: LEADER: Nightmare legacy of the Labour Party
Daily Mail: The £19bn project overspend
Metro: £19bn bill for project overruns
Construction News: Overruns on public projects cost £19bn
Computer Weekly: More than half of £19bn overspend on government projects due to NPfIT
Politics.co.uk: 'Unmanageable' government wastes £19 billion
ConservativeHome: CentreRight: Matt Sinclair: Big Government projects keep going over budget

New Research: International Development Spending
 
A new report released by the TPA last weekend investigated the controversial area of Internation Development spending. Spending by the Department for International Development (DfID) has been ringfenced and protected from spending cuts, but our current approach to development is not delivering the progress many hoped. Even if a future Government chose to ringfence such expenditure, it is crucial that they look to improve the effectiveness of their aid spending. To that end, the report calculates that £685 million of development spending actually goes on non-frontline costs at the multilateral organisations and NGOs to whom the money is given. You can read the report here.  

Good news from the BBC
 
There were some encouraging opinion poll result released by the BBC this week, which back up both the case for spending cuts and the argument that the public are more practical than politicians about the public finances. The poll, presented and analysed by the BBC's Stephanie Flanders here and here, reveals some home truths that politicians in Westminster would do well to take note of:
  • Given the choice, 59% of the public want spending cuts to balance the public finances, whilst only 34% want tax rises.
  • A massive 90% of the public support at least one measure to restrain public sector pay. The most popular proposal, with 56% support, was the pay cut for the top 10% in the public sector first proposed in our joint report with the Institute of Directors back in September.
  • On a more controversial topic, the public are marginally in favour (48% vs 42%) of stopping paying child benefit to the better off - something else we have been campaigning for.
  • Encouragingly, only 39% want to see higher green taxes, and the majority of the public are opposed to a VAT increase.
Ordinary people who actually bear the brunt of taxes are opposed to higher taxation and want to see lower spending - this means our message is getting through. Now we need to drive it home in Westminster.

Grade Gordon
 
Power 2010, a new campaign to idenitfy key and popular reforms to improve the way our politics works, has just launched an appeal for people to "Grade Gordon Brown". Do you think the Queen's Speech did a good job at restoring our politics? Do you feel it was a missed opportunity to press home the Kelly reforms to MPs' expenses? You can pass on your message here. The TPA is working with Power 2010 to develop a menu of different ideas over the next few weeks which will then be put out to public vote, so do keep a look out for more on this topic.
 
TPA Cinema Advert Goes Live
 
The TPA's first cinema advert, which we emailed you about on Monday, goes live today. This is a really exciting development and a big leap up for the campaign, and we wanted to take this opportunity to thank the hard work and keen support of all those of you who have helped us reach this point. Together we are making big progress and reaching more people than ever! The book has attracted an amazing reaction from the public - we intended to send out 5,000 free copies but we have already received over 32,000 orders so we have extended the offer. You can watch the cinema advert on Youtube here and order the book for free from this link. 

Best of the Blogs
 
Economics 101: Global entrepeneurship week
Burning Our Money: Big and inefficient  
Better Government: The Speed Camera gold mine  
West Midlands: Film's a flop after £380k of taxpayers' cash  
West Midlands: The Public Watch No. 3  

Posted by Britannia Radio at 15:49