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Improving Corporate Functions Using Shared Services
Eighteenth Report of Session 2007-08 Report, Together with Formal Minutes, Oral and Written Evidence
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Corporate services provide vital support to the delivery of effective and efficient public services. They include activities such as finance and accounting, human resources, procurement, information technology, facilities management and estates management. Shared services are designed to improve efficiency and service quality by combining such activities across different parts of an organisation, or across separate organisations. The Cabinet Office has estimated the cost of finance and human resources functions across government as GBP 7 billion a year. It believes there is scope to save in the order of GBP 1.4 billion annually through the use of shared services.This report examines the Cabinet Office's efforts to improve corporate functions using shared services, as well as the impact of two of the more established public sector shared services in the NHS and the Prison Service. NHS Shared Business Services is a joint venture between the Department of Health and Xansa PLC selling procurement, finance and accounting services to 89 NHS organisations out of a total of 416 potentially eligible NHS bodies. It is not yet making a profit and has paid no dividend to either the Department of Health or Xansa. It needs to attract a further 22 customers simply to break even, and approximately 180 more customers to deliver its forecast savings to the taxpayer of GBP 250 million by 2014-15. HM Prison Service's Shared Services Centre provides finance, procurement and human resources services to all 128 Prison establishments, and the system is now working well.
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