Whitehall lost millions during Covid because it ‘too often clings to projects that have failed’
Whitehall lost millions of pounds during Covid because it did not understand risk well enough and too often clinged to projects that have failed, a report has argued.
Dame Meg Hillier, the chairman of the cross-party public accounts committee, used her annual report to examine “repeated problems” affecting governance across the civil service.
The veteran Labour backbencher warned ministers they were still being too slow in recovering taxpayer cash that was lost to a combination of fraud and error across several government schemes during the pandemic.
Drawing a contrast with the private sector, Dame Meg wrote: “The mantra of the technology world is ‘fail fast’ – a culture where error can be quickly acknowledged and rectified, where we learn from our mistakes.
“Whitehall too often clings to projects that have failed. I still see too much optimism bias in operation and the movement of staff means that this optimism is sometimes inherited by later programme leads who don’t have a project overview.”
Better prepared
Dame Meg insisted the government had to become better at dealing with uncertainty and added that “we could have been better prepared” when coronavirus hit Britain at the start of 2020.
“We need to learn the lesson that there is always unpredictability. The military mantra is that no plan survives the battle, but never go into battle without a plan.
“Put simply, we were unprepared. Whitehall is resistant to creating a chief risk officer. We need to see a step change in Whitehall and among politicians about the value for spending to mitigate or be prepared for risk.
“Optimism bias creeps in here too – no-one thinks it will happen on their watch.”
£14.9 billion in waste
The committee noted that an “extraordinary” £14.9 billion in waste had been accrued by the Department of Health and Social Care (DHSC) in personal protective equipment and other spending relating to the Covid response.
Dame Meg singled out the DHSC, the Ministry of Defence (MoD), the Department for Levelling Up, and HM Revenues and Customs (HMRC) as “departments of concern”.
She warned that the MoD was struggling to manage its major contracts “in an increasingly difficult context”.
The HMRC was urged to carry out a full evaluation of schemes – including furlough and self-employment programmes that ended up excluding millions of workers – in order to learn from them “the next time a large-scale financial intervention is needed”.
Elsewhere in the report, Dame Meg urged Whitehall as a whole to “do better by the taxpayer” by seeking to reduce the current levels of fraud and error, both of which have risen significantly since the pandemic.
