'Billions' wasted by British public bodies

BRITISH PUBLIC bodies are wasting billions of pounds every year, according to one of the country’s biggest retail entrepreneurs, Sir Philip Green, who carried out a spending review for prime minister David Cameron.

Government departments, agencies and local authorities pay for 100,000 mobile telephones for staff, rent buildings they do not need and fail to use their negotiating power properly, said Sir Philip, who runs Topshop and other major high-street clothes stores.

Describing the wasteful practices unearthed by the inquiry as “staggering”, cabinet office minister Francis Maude said every pound saved was “a pound that can be protected for frontline services”.

Some state bodies paid up to £73 (€83.60) for a box of printer paper – eight times more than the average, while the prices paid for laptops varied from £350 to £2,000. Printer cartridges cost some organisations £350 each.

The decision to appoint Sir Philip was controversial because most of his business interests are held in the name of his wife, who is a resident of Monaco, and are thus not liable for British taxes.

He owns the Arcadia group, which runs more than 2,000 Topshop and BHS stores in the UK, and he has the reputation of being a ruthless cost-cutter.

Sir Philip and his wife took a £1.2 billion tax-free dividend out of the company in 2005.

In his public spending report, Sir Philip was scathing about the handling of property contracts. One agency moved to the Midlands from London and signed a 20-year lease at £1.2 million a year, with no break clause for 15 years. It was abolished nine months later. Six months ago, officials failed to break a lease on a surplus building, missing out on £5 million-a-year savings.

Civil servants could not even put a figure on travel costs. Firstly, they said Whitehall spent £2 billion a year, then they said £500 million. Later, they estimated €750 million.

The real figure, which includes renting out 400,000 bed nights in London hotels, is £550 million.

Refusing to put a figure on the waste exposed, Sir Philip said: “There is no reason why government should not be as efficient as any good business. The conclusion of this review is clear – credit-rating and scale in virtually every department has not been used to make government spending efficient.”

However, critics say his recommendations run counter to the Conservative/ Liberal Democrats’ determination to give more powers to local bodies and that small firms would lose out on state contracts.