PAC worried shared services strategy set to fail

Value for money in doubt

The Cabinet Office claims the shared services strategy will achieve £4.3bn in benefits over 15 years. However, a National Audit Office (NAO) report, published in March 2026, found that the net benefits at £1bn.

According to the report, Cabinet Office acknowledged that the £4.3bn figure “does not account for costs”, and that it “could not quantify what the total costs of delivering shared services are”.

“In its subsequent correspondence with the committee, the Cabinet Office clarified that its strategy’s £4.3bn benefits figure had been calculated from a mixture of its dashboard and clusters’ full business cases,” the report said.

“The Cabinet Office’s correspondence reported shared services’ change costs at £846m in one section, and around £1.6bn in another section: as compared to a mid-range estimate of £4bn had each department procured their systems individually.”

However, these costs are not calculated from the same baseline as the benefits Cabinet Office has given the PAC, and rather from HM Treasury’s commitment to the clusters in the 2025 Spending Review, and don’t include costs from two of the clusters.

“The fact that the Cabinet Office could not provide the high-level cost-benefit analysis we asked for at our hearing, appears to confirm lack of clarity in the Cabinet Office about this whole project,” the report said, adding that the department needs to appoint a single person responsible for the strategy.

Lack of buy-in

The value for money is also dependent on departments actually engaging and buying into the strategy. However, both HM Treasury and the Department for Education (DfE) have not committed to the strategy, despite Cabinet Office telling the PAC that it understands both departments have “unconditionally bought into joining shared services at the outset and maintains that their participation in shared services is not optional”.

But according to the report, HM Treasury claims it has the “right to unilaterally decide whether to proceed” with joining its assigned cluster, and won’t decide until December 2026.

The DfE is also looking at further information on value for money, and whether the project is feasible, before committing.  Both of these departments are in the Matrix cluster and have modern ERPs in place already.

“These actions, by two major government departments, send a very poor reputational signal to the rest of the project,” the report said.

The dashboard Cabinet Office has created a dashboard, aiming to bring together data from each individual cluster on costs, benefits and milestones. However, the dashboard relies on Cabinet Office getting information from the clusters about their  plans.

“As the Cabinet Office lacks the mandate to enforce these commissions, the quality and completeness of the data the dashboard contains varies significantly,” the report said, adding that one part of the dashboard was missing data for 21 out of 64 returns.

PAC chair Geoffrey Clifton-Brown said that while the committee supports the idea behind the shared services strategy, “it has long been evident that government departments, often islands onto themselves cut off from each other, need to work more effectively together – in short, to learn to share.

“Pooling back-office functions should be an easy win, and one which the Cabinet Office insists to our inquiry could save the taxpayer multiple billions. Unfortunately, there is no plan or timeline for achieving this, and little explanation of how government have arrived at the figures for the predicted savings,” he said.