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Coffee House

Revealed: the most expensive government services

19 January 2013

7:14 PM

19 January 2013

7:14 PM

Anyone mulling how the government can save a tidy sum of money could do a lot worse than to sift through the slew of data released this week by the Cabinet Office on how much government services cost. It sounds a bit techy, but the breakdown of costs underlines how important the  ‘Digital by Default’ approach to public services pioneered by Martha Lane Fox really is.

Currently non-digital government transactions cost £4 billion a year. The Government Digital Service believes between £1.7 billion and £1.8 billion worth of annual savings could be made by making transactional services digital.

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The Cabinet Office data shows that the most expensive Government transaction is the Rural Payment Agency Single Payment Scheme, which costs £727 per transaction.  The Environment department aims to digitise this service to reduce the cost.

When you examine the cost-per-transaction of solely digital services, you can see why departments are so keen to get in on the act. Stamp Duty Return Tax is an exclusively digital process and costs a mere 5p per transaction: the cheapest on the list. It is unacceptable that other services are not delivered in the most cost efficient way possible.

Before we get too excited and idealist, it’s worth remembering that not every service can be provided digitally. For example, while a passport application costs £64.68, GDS says total digitisation would not be more efficient because of the security implications. And in this case, the cost is picked up by the user, rather than the department.

But there are other services which can and should go digital because of the benefits for departmental spending. Digital revolutions aren’t just for nerds: they’re for bean counters too.

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