Outsourcing could save UK £23bn, says CBI

THE CBI has urged the government to open public services up to competition more quickly, arguing it could save the taxpayer nearly £23bn a year.

Despite the row over G4S’s performance at the Olympics, the UK’s largest business group said opening up service contracts to private businesses, mutuals, charities and social enterprises would make huge savings.

CBI director general John Cridland said there had been “some action in some parts of government” since a white paper 15 months ago, but said there was still some inertia.

The CBI based its figures on a report by consultants Oxford Economics, which suggested public services worth £278bn would benefit from being opened to competition, saving the government £22.6bn a year.

Total public spending this year by central government and local authorities is projected to be £676.6bn and the CBI argued any cuts would help balance the budget by the end of 2016-17.

“If you look at what government says about public service reform and what the CBI would want to see done on public service reform, there’s a very significant overlap. It’s momentum we say is lacking,” said Cridland.