10th Report - Government shared services

Key findings

• The Cabinet Office claims £4.3 billion in benefits over 15 years but cannot credibly explain costs or demonstrate value for money; the National Audit Office reports only £1 billion net of cost, and £1.15 billion has already been committed with £846 million-£1.6 billion in delivery costs.
• Governance is fragmented across multiple overlapping boards with no single person accountable for delivering the strategy; key decisions affecting delivery remain spread across clusters, departments, and central functions without clear ownership.
• HM Treasury and the Department for Education, both assigned to the Matrix cluster, refuse formal commitment to onboarding, claiming the right to unilateral decision-making subject to further information—undermining the strategy's core premise of mandatory 'One Civil Service' participation.
• Synergy cluster awarded a £700 million HR and payroll outsourcing contract to Capita (reportedly 40% below the government's 'should cost' model) despite Capita's documented poor performance on Civil Service Pensions and other major contracts; no comparative value-for-money case was published versus the Unity cluster's in-house model.
• Mismanaged interdependencies with at least 25 other digital programmes have caused avoidable delays and costs; the failed Applicant Tracking System programme alone cost £26–38 million and was abandoned due to poor cross-governance coordination.
• The Cabinet Office lacks reliable, converged HR and commercial data; the Government People Function has not implemented required NOVA standards with no precise timeline provided, whilst the Government Commercial Function opted out of NOVA entirely, delaying cluster readiness.

Recommendations

• The Cabinet Office and Civil Service Transformation Board should urgently conduct a comprehensive review of the Shared Services Strategy, including an assessment of whether delivery remains viable and should proceed. Upon completion, this review should be shared with the Committee.
• The Cabinet Office should urgently publish a case for change outlining how the Shared Services Strategy will deliver value for money, including: (a) economic case comparing current benefits and costs to viable alternatives; (b) roadmap with timetables, dates and costs until all government in scope is onboarded; (c) complete terms of reference for all stakeholders delivering shared services; (d) review comparing value for money of different cluster delivery approaches including outsourcing; (e) details on the Synergy-Capita contract including confirmation of 40% discount claim and comparison with 'should cost' model (confidentially if needed); (f) details on assurance work that Capita will deliver fully on contract commitments.
• The Cabinet Office should appoint a single person to be in charge of delivering government shared services, with accountability and required mandate for doing so. This appointee will be required to update the Committee annually on progress against delivery of the strategy.
• The Cabinet Office should urgently clarify: (a) the role of the Transformation Board in securing and maintaining departments' commitment to shared services; (b) its position on the obligations for departments currently using modern cloud-based back-office systems to onboard to their assigned shared service cluster. The Treasury Minute Response should confirm HM Treasury and Department for Education's position on onboarding to Matrix, including the rationale behind this.
• The Cabinet Office should: (a) review its decision not to address NISTA's recommendation by implementing a government corporate services board with a mandate for mediating between clusters, functions and interdependent change programmes; (b) present the Committee with an action plan to address risks with interdependent change programmes.
• The Government People Function should commit to a roadmap and timeline for implementing all NOVA processes. The Government Commercial Function should commit to engaging with NOVA and implementing its revised functional standard.

Key actors

Cabinet Office, HM Treasury, Department for Education, Capita, National Infrastructure and Service Transformation Authority (NISTA), Office for National Statistics, Public and Commercial Services Union, Sir Geoffrey Clifton-Brown