09 July 2008
Speech by the Exchequer Secretary to the Treasury, Angela Eagle MP at the High Performing Property and Relocation Conference, QEII Centre, London
Check Against Delivery
1. It's a pleasure to be here at today's Conference and the size of it indicates just how important this subject is, it is often one that is neglected by those that write newspapers ,but it is one of those vital pieces of public service delivery where it is difficult yet extremely important that we do an effective job.
2. As I'm sure you've heard already today, that estate is worth £30 billion - and it costs us around £6 billion a year to run.
3. They are huge amounts and it is taxpayer's money that we are spending, and we are facing a challenging economic time - we have to make sure that we're getting the best possible value.
4. And I'd like to reiterate some of what Nigel has said about the progress we're making against that strategy - and particularly about what more needs to be done in the years ahead to meet our target of saving £1 - 1.5 billion a year by 2013, and to make sure that the estate is meeting our needs effectively. That's the 'leaner' part of the Conference's title.
5. But it is also important that we talk about the 'greener' part too.
6. We all know what a big challenge climate change is, and we all know also that tonnes of carbon abated earlier on in the process, as we move towards our target for 2050, are worth much more than tonnes of carbon abated later on and we also know that the kind of decisions that you make, day in and day out, about the estate have an impact on the future, so it is important that we bear those factors in mind as we make our decisions.
7. I've already mentioned the target of reducing running costs by 25% by 2013. Some of that will come from continuing to dispose of surplus accommodation, and from better procurement of facilities management and leasehold contracts.
8. But we're expecting the majority to be the result of reducing the space we need, and using the space we have better; that means that we will need to accommodate more people in less space.
9. The amount of space per person will need to drop from its current average of 17 square metres, to a new target of 10 square metres per person for new office buildings and major refurbishments.
10. But this isn't about making people feel like they're being crammed into buildings. There are different ways of using space, more intensively used space will need to be better quality, better designed and better managed; and it can make for better, and more productive, more interesting and more rewarding places to work.
11. So applying those standards across the civil service could save us up to £1.25 billion a year.
12. The Government Property Benchmarking Service, for example, looks at the efficiency and effectiveness of each individual building, which gives us the data to decide which to keep, and how to improve those, which we do decide to keep.
13. And I'm pleased to say that the use of property benchmarking is now mandatory for all government organisations - which I have to say contrasts starkly with the private sector, where a recent survey by the CBI and GVA Grimley showed that only 50% of companies undertake it.
14. Making benchmarking mandatory means that by the autumn, it will cover 150 organisations, and 2,400 properties - one of the biggest coverage of any sector in the UK.
15. We've also got the e-PIMS database - which is the electronic Property Information Mapping Service, our central property database.
16. This means that we have a much more co-ordinated view across the Government estate, which makes it easier to plan how to use space that might be becoming vacant, including co-locating different organisations in the same building - as we've done with OGC and the Treasury in fact, at 1 Horse guards Road.
17. This means that we can track the actual amount of vacant space that we have on the government estate, and make sure that we are either using these holdings or actually planning and disposing of them.
18. Our record here is good. On average over the last three years, vacant space has been around 1.6% of the total, but over the first six months of this year it has fallen to 1.4%. Again, this compares well with the private sector, where vacant space can be four times greater.
19. In addition to e-PIMS database and the Benchmarking Service, I'm also pleased to announce today the launch of a new online service, called the Property Interrogator.
20. This tool will use data from e-PIMS to provide detailed information to Board level Departmental Property Champions on the efficiency and effectiveness of their buildings and estates, and allow them to compare performance within their departmental family, by which I mean including their agencies and sponsored bodies, and I hope a healthy rivalry will develop with other departments.
21. It is important to include sponsored bodies, given that they manage and use 72% of the government estate; and this tool should prompt property Champions in each department to look for improved performance.
22. This means that we're in a position to achieve our targets in the years ahead because we have the tools to do so - and that will make an important contribution to our wider work on getting the taxpayer the best possible value. For example, annual savings of £1.5 billion is the equivalent of being able to buy an extra 10 new hospitals every year.
23. As you might know, across government we're committed to saving £30 billion from our procurement over the next three years - on top of the more than £20 billion we saved in the last three.
24. Now we also want to look at the targets we've got to reduce running costs as at the moment these only cover the civil estate - which excludes NHS buildings, schools, local government property and the MOD's operational estate.
25. And we now want to look at those areas too, and at the estate as a whole, and build on what OGC and departments have achieved so far.
26. We announced on Thursday last week that Patrick Carter is going to be leading on the property strand of the Operational Efficiency Programme.
27. He'll be looking at how robust and ambitious our existing High Performing Property strategy is; and how we can extend our current programmes to the entire government estate, take a more strategic approach; how we can use private sector expertise or financing to improve efficiency; and the opportunities to further improve the overall management of the estate, and reduce its size.
28. And he'll be giving us an update in time for the Pre-Budget Report in the autumn, before the Programme reports at next year's Budget.
29. That Programme, and the rest of our work to improve the efficiency of our estate, is obviously more important than ever given the challenges we face in the economy at the moment. And we should be looking to save money wherever we can.
30. But the key is to get the best possible value, which is about more than just the lowest cost, it is about more than a narrow view of value for money - it's about making sure that our estate meets our needs as effectively as possible.
31. I know that you've just been hearing from Frank Duffy, the co-author of Working Beyond Walls, and I really want to welcome its launch today - and I understand you're going to get advance electronic copies shortly, ahead of its publication later this year.
32. The previous collaboration between Frank and the OGC a few years ago, Working Without Walls was, rightly, highly acclaimed, and showed how the Government estate needed to adapt to changing ways of working, and how that could in turn help to improve effectiveness and efficiency.
33. That report was instrumental in influencing workplace improvements we are seeing in a number of government buildings today.
34. And Working Beyond Walls has all the ingredients of an equally successful and influential publication. It looks particularly at the way that the increasing mobility of workers, and the increasing use of technology, changes the needs which we have for our estate - and that in turn will help us to respond to those needs.
35. So thank you, Frank, for all of your work, along with your colleagues at DEGW.
36. This really will make a contribution to helping us make sure our estate is effective, as well as efficient, and that we're getting the best possible value.
37. I would like just to spend a little bit of time talking about making our estate greener.
38. One of my roles as a Minister is leading on green taxes, we are absolutely certain that these taxes are aimed partly at changing people's behaviour, so that they do things like buying less polluting cars.
39. As a Government, we also try to persuade people to do that by giving them information, and advice - which is why we've set up a Green Homes Service, for example, to tell people how they can reduce their impact on the environment and in these times of high energy prices, their bills.
40. The aim is to encourage lots of little changes, which add up to a big impact overall. And the lesson is just as relevant for us as a Government.
41. In procurement, we're now setting up a Centre for Expertise in Sustainable Procurement, as part of our aim to be among the best at this in Europe by 2009.
42. And I'm delighted to announce that we're launching a pamphlet today called Buy Green and Make a Difference, which will show public sector procurers how they can take positive action to protect the environment through the money they spend. You can download copies from the OGC website, and I hope you'll all have a look, it is a very good guide to how we can include sustainability issues in the every day decisions we make about our estate.
43. So, leaner and greener - those seem like two good aims for the government estate to me, which is why I very much welcome the theme of today's conference.
44. As you can see, we've got targets to take us towards them: reducing running costs, reducing the amount of space used for each member of staff without making it difficult for them to do their job of course; and reducing carbon emissions, waste generation and water usage.
45. These targets are stretching and are not going to be easily met. They will be met through your professionalism and your creativity and through thinking innovatively in a non-linear way.
46. But to get there, we need to be making progress now. We are already doing that, and as I've said we've now got many of the tools we'll need in place.
47. And I think we're entering a crucial phase now, when we've got to start fully using those tools, and starting to deliver the benefits.
48. Today's conference is a big step in doing that, and so I'm pleased to have the chance to speak to you all, and to stress how important the work you're doing is to us in Government.
49. Thank you very much for that - and thank you for listening.