Edward Leigh MP, Chairman of the Committee of Public Accounts, today said:
"The UK requires a presence overseas and the Foreign and Commonwealth Office is responsible for over 4,000 buildings in 279 locations around the world, valued at a combined total of £1.6 billion.
"Some of these buildings have diplomatic, strategic and symbolic importance and include embassies, High Commission and Consular offices, and Ambassadorial residences.
"I welcome improvements in the management of this valuable estate, in particular with the development of a new strategy and the appointment of an estates director.
"But, despite this progress, the Department has a long way to go. It has a poor understanding of its overseas estate and the information it has on these properties is incomplete, out-of-date and inaccurate.
"The Department also has too much unused space in its offices. When other UK government organisations overseas are paying for office space in the same city in which the FCO has empty office capacity, it is clear that the taxpayers’ interests are not being served.
"Managing these properties is not always an easy job, but it is an important one and the Department has to do it better. It has to start by getting better information on its estate, it has to use the space it holds more effectively and it has to lower its costs.
"It is still the firm position of this Committee, though, that the FCO should not seek to sell-off historic residences."
Mr Leigh was speaking as the Committee published its 25th Report of this Session which, on the basis of evidence from the FCO, examined its management of its global estate.
The FCO (the Department) has over 4,000 buildings across its global estate, in 279 different locations.
The estate is a mix of properties including embassy, high commission and consular offices, ambassadorial residences, prestige and historical buildings and staff accommodation.
The estate is valued at £1.6 billion and capital and revenue expenditure in 2008–09 totalled £269 million. Thirteen thousand of the Department’s staff work in its offices overseas.
The many functions of the Department’s properties overseas mean they are not easily comparable to typical government buildings in the UK.
No two locations are the same and difficulties created by security, terrorism, turbulent markets and exchange rate fluctuations all affect the Department's ability to control costs and make best use of its estate.
The Committee welcomes the improvements the Department has made in managing its estate more effectively, including the recent appointment of an estates specialist as estates director and the development of a new estate strategy.
The Department however has a poor understanding of its estate and the information it holds on its properties is basic, incomplete, out of date and inaccurate.
In addition, the Department does not collect data, such as the cost and amount of space per person, recommended by the Office of Government Commerce for the effective management of government offices in the UK.
The Department has unused space in its offices even in locations where other UK government organisations are based in separate premises.
Other organisations are often deterred from co-locating with the Department because of the security measures necessary in embassies as well as the high charges they must pay to use the Department’s buildings.
The Department now needs a better managed estate with improved data to enhance understanding of the estate, and its new strategy to be implemented effectively at each location.
It needs to achieve better outcomes—lower costs, better use of its space and improved project management, as it has delivered a number of projects late and over budget.
The Department made a commitment to us that it would be able to report a much improved picture within 18 months as a result of the extra focus and attention that it intends to place on its estate.