DCMS decisions “not robust”

The recent DCMS decision to close and merge some of its arm’s length bodies (AP229, AP226) was “not informed by a financial analysis of the costs and benefits”, according to a new report by the National Audit Office. Instead it was based on “estimates which did not take account of the full costs of closure such as lease cancellation, redundancy and pension costs”. No assessment was made as to what the future savings might be, or of what the pay-back period would be. Instead, a standard, flat-rate cut was applied to the budgets of most of its arm’s length bodies, and the DCMS is “not yet in a position to assess the ultimate impact of these cuts on frontline delivery”. The report recognises that quick decisions were made on budgets to allow arm’s length bodies to plan their own cost reductions swiftly, but concludes that the quality of financial management at the DCMS is not yet sufficiently robust. Amyas Morse, head of the National Audit Office, said: “There is still a way to go before I can say that [the DCMS] is achieving value for money.” He urged that the commitment shown by the DCMS to responsible financial management of the Olympic programme “needs to be replicated across the Department’s wider responsibilities”.