£600m annual savings for UK Taxpayers

Monday March 4th, 2013

Government Opportunities (GO) After a decade of frustrated attempts, the government is driving down the cost of back office functions by establishing the first independently-run shared service centre.

The initiative, which is a key part of the Civil Service Reform Plan, will harness private sector expertise to deliver savings for the taxpayer of up to £600m a year.

The government has signed an agreement with business process outsourcing partner, Arvato, to manage Independent Shared Service Centre One (ISSC1), which will be created from the existing Department for Transport (DfT) shared service centre, based in Swansea, South Wales.

Under the agreement, Arvato will provide back office services to the DfT and its executive agencies. This is expected to deliver significant savings to DfT over a seven-year period. The newly independent centre will then expand to provide HR, procurement, payroll and finance transactional services to multiple government departments and arms-length bodies.

The economies of scale will enable arvato to drive down costs and improve service levels by sharing expertise across customers, adopting common processes and systems, and investing in new tools.

Combined with the second Independent Shared Service Centre, which will come on stream early next year, business could grow by taking on additional customers from both the public and the private sectors as well as offering new services to existing customers as required.


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