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Contractors shave £10bn off government spending

Innovation by contractors helped the government achieve £10bn of efficiency savings in the last financial year, it has been revealed.

The coalition’s Efficiency and Reform Group this week published details of savings made in the 2012/13 financial year.

It said £1.7bn of this came from large projects, including construction schemes.

Schools building efficiencies amounted to £86M; while £145M was saved on Crossrail alone.

The Civil Engineering Contractors Association said contractors had worked hard to find cheaper ways of doing their jobs.

Director of external affairs Alisdair Reisner told NCE: “The government has engaged with industry about the realities of cost reduction: keep going and watch your market reduce or find more effective ways of doing things.

“It seems the industry has done well. There are real savings from genuine improvements in ways of doing things.”

Reisner said further efficiencies were likely to be found as the government kept the pressure on suppliers.

But he said it was vital that contractors found “genuine efficiencies” rather than passing the buck down the supply chain.

“We have to avoid cutting the margins of the supply chain,” he said.

Cabinet Office minister Francis Maude said the government was taking “radical decisions” to make Whitehall leaner.

“The unprecedented £10bn savings last year shows we have defied expectations and accelerated the pace of reform. There can be no going back to the old, wasteful ways of doing things which we saw in the past,” he added.

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