Committee of Public Accounts: Press Notice


Publication of the Committee's 44th Report, Session 2007-08

Edward Leigh MP, Chairman of the Committee of Public Accounts, today said:

"One of the biggest public sector construction projects in the UK in recent years - to deliver more than 800 modernized Jobcentre Plus offices - achieved its central procurement aims while coming in under budget.

"This welcome success was down to a number of different factors, but chief among them were the maintenance of continuity in the leadership team, the substantial front-line experience of the senior managers, a willingness by the team to learn and revise its approach as the project progressed, and the engagement of local staff in the change process. At all stages the risks were managed well and tight financial controls were applied. Other public sector organizations taking forward big procurement and change projects cannot afford to ignore this exemplary good practice."

Mr Leigh was speaking as the Committee published its 44th Report of this Session which, on the basis of evidence from Jobcentre Plus (the Agency), examined the procurement of the new office network, including the realisation of benefits to customers, the Agency and the taxpayer.

Between 2002 and 2008, the Department for Work and Pensions (the Department) replaced over 1,500 jobcentres and social security offices across Great Britain with a network of just over 800 modernised Jobcentre Plus offices. The aim was to significantly improve the job-seeking experience and the delivery of benefits by providing a service similar to that offered by a bank or modern retailer. To achieve such a radical shift away from the previous fragmented approach, the Department for Work and Pensions merged the Employment Service and the Benefits Agency into a new integrated service, Jobcentre Plus.

This roll-out was one of the largest public sector construction programmes undertaken in the United Kingdom in recent years. It cost £1.9 billion and was designed to improve efficiency by reducing the size of the estate and automating processes. The project was also intended to provide the infrastructure for improved customer service through a more tailored approach, increasing the number of work-focused interviews and helping to reduce unemployment.

To succeed in its roll-out of Jobcentre Plus, the Department had to:

manage very complex disposal, procurement and construction projects;

change the way that staff provided services to their customers; and

produce savings that justified the £1.9 billion investment.

Having learnt lessons from early difficulties, the project was successful in delivering nearly all the planned offices, while making savings against the original budget of £2.2 billion. The estate rationalisation generated savings of £135 million a year, and the Department estimates that the roll-out will ultimately lead to cumulative benefits of £6 billion, with the project due to break even in 2012-13. These forecast future benefits include savings from improved job outcomes, which are influenced by many other factors including the state of the economy. The modernised network is designed to give the Agency more flexibility to deal with future demand.

The successful delivery of the programme can be attributed to sound governance, intelligent use of existing guidance and external advice, and strong support from the leadership of the organisation. A critical factor was the consistent senior management team, who between them had over 100 years of front line operational experience in the Agency's business. A willingness to revise the approach to the project as roll out proceeded was also an important factor in success. The successful project management approach provides important lessons for other public sector bodies undertaking major procurement and change projects of this kind.