Government insists 'bonfire of quangos' will save £2.6bn

The Government has insisted its “bonfire of the quangos” is on track to save the taxpayer £2.6 billion.

Cabinet Office minister Francis Maude said that 106 of the more than 900 bodies in existence at the general election have now been axed. Mergers have cut numbers by a further 80.

"The changes we have already made will save £1.4 billion, but by 2015 the Government will save the taxpayer a total of more than £2.6 billion - that's more than £150 per working household," Mr Maude said.

"We have already closed 106 bodies and merged 150 bodies into fewer than 70, but we are only halfway through the first phase of our programme.

"Once we have completed the planned closures and mergers, we will continue to review all remaining quangos to ensure that never again will we end up with so many of these vast bureaucratic and unaccountable bodies."

The influential Commons Public Accounts Committee has previously questioned the £2.6 billion savings estimate, warning it is based on "incomplete and imprecise" information.

The up-front costs of the reorganisation are forecast to be anywhere between £600 million and £900 million.

However, the Cabinet Office insisted the figures had been checked and signed off by top civil servants at departments.

Institute for Government programme director Tom Gash said Mr Maude seemed to be engaged in a "slash and burn" exercise.

"If the figures do stand up to scrutiny and there has been no decrease in government performance in services, this is a good thing but the reliability of the savings claimed is questionable," he said.

"Slash and burn exercises have proved counter-productive in the past and can even incur more costs in the long-run."

TaxPayers' Alliance chief executive Matthew Sinclair said: "The abolition or merging of scores of unnecessary, costly and bureaucratic quangos by this Government is to be welcomed.

"But as Francis Maude rightly says, there is plenty more to do in terms of cracking down on the quango state: so not only must he keep these unaccountable bodies in his sights, but also ensure that any savings made by their abolition or downsizing are not frittered away by others in Whitehall."

Shadow Cabinet Office minister Jon Trickett said: "This so-called clampdown is not what it seems.

"The true picture of David Cameron's Government is of a failed economic plan which has delivered a double-dip recession and £150 billion more borrowing than they planned.

"Far from cutting bureaucracy they've launched an unwanted and wasteful upheaval of the NHS, creating a new NHS Commissioning Board, which David Cameron has been warned 'could turn into the greatest quango in the sky' while the NHS is losing nurses at a rate of 200 per month."

PA