% of grant-in-aid
In confidence
Principal efficiency and effectiveness measures for central services
• total cost of utilities and maintenance per post in London and Manchester
• total net cash return on investment in IT since April 1989
• staff costs of central services departments as a % of total global staff costs
• % of Council offices where top and senior management considers the application of corporate design policy to be satisfactory
• % reduction from 1988/89 levels in expenditure on communications in headquarters.
Overheads
15.18 The Council will continue reducing corporate overheads as a percentage of operating income, particularly those of price-sensitive businesses. It will:
• rationalize central services and bring them under line management where this is more effective or efficient
• monitor and seek to reduce the costs of those central services which cannot be devolved to the management line
•
⚫ investigate the benefits of charging to departments outside London the costs and services which are directly related to their premises
⚫ reduce overheads of operational departments and Representations.
15.19 CP2 stated that the Council would use the formula for apportionment of overheads to operational posts in headquarters as its principal indicator for the reduction of overheads, and would pursue a policy of bringing this down towards 100%. Targets and achievements are monitored closely but are not published for commercial reasons.
Efficiency
15.20 Figure 19 compares the Council's efficiency performance achieved and forecast with the 1.5% minimum expected throughout Whitehall. It shows increased efficiency gains from relocation forecast by 1993/94. The Council's ability to maintain its efficiency gains depends both on continued real growth in operating income and on management's successful communication to staff of efficiency needs.
15.21 The Council intends to introduce corporate efficiency measures from 1991/92, which will aggregate total global performance at home and overseas and indicate trends for which the Council is prepared to be accountable.
15.22 Many managers are improving efficiency each year, not by reducing costs but by holding down costs while the volume of work increases. The Council has yet to develop adequate systems for recording increases in output, and linking
Efficiency gains: performance and forecasts
1988/89 to 1993/94
2.4
2.2
2.0
1.8
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0
1988/89
HMT minimum requirement
1989/90
1990/91
Efficiency achieved/forecast
1991/92
1992/93
1993/94
Figure 19
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