Date: Wednesday 12 January 2005 IMMEDIATE RELEASE
Contact:Matthew Elliott on 07795 084 113 /
Government wastes£81bn - four times more than Brown admits
  • Government waste and useless spending costs taxpayers £81bn a year, the TaxPayers’ Alliance, the independent grassroots campaign for lower taxes, reveals today in their second detailed waste audit of Britain’s public finances.
  • The TPA believes that the £81bn savings should be returned to hardworking taxpayers in tax cuts.
  • This timely comparison – released ahead of the Tories’waste review this Sunday – proves that neither Gershon nor James are thinking radically enough to give taxpayers value for money.
  • Waste and useless spending is costing every family in Britainnearly £3,330 per year –what each household spends on transport or food and clothing each year.
  • Scrapping the wasteful projects listed in the audit would allow Gordon Brown to abolish national insurance contributions (£78bn) and inheritance tax (£2.9bn) or introduce a 10p/£ flat rate of income tax.
  • The TPA is challenging Sir Peter Gershon and David James to participate in its forthcoming election debate on how to cut government waste in the next Parliament.
  • In the Foreword, Ruth Lea describes the report as “invaluable”, “welcome and soundly-researched”.
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Andrew Allum
Chairman
Matthew Elliott
Chief Executive
Florence Heath
Outreach Director
_____
Advisory Council
Prof. Norman Barry
University of Buckingham
John Blundell
Institute of Economic Affairs
Keith Boyfield
Keith Boyfield Associates
Dr Eamonn Butler
Adam Smith Institute
Prof Tim Congdon
Lombard Street Research
Dr Stephen Davies
ManchesterMetropolitanUniversity
Prof. Kevin Dowd
University of Nottingham
Dr Charles Hanson
Economic Consultant
Ruth Lea
Centre for Policy Studies
Keith Marsden
Consultant, United Nations
Prof. Patrick Minford
CardiffBusinessSchool
Prof. Kenneth Minogue
LondonSchool of Economics
Michael Mosbacher
Social Affairs Unit
Prof. Dennis O’Keeffe
University of Buckingham
Dr Madsen Pirie
Adam Smith Institute
David B. Smith
Williams de Broë
James Sproule
Augusta Finance
Gabriel Stein
Lombard Street Research
Dr Elaine Sternberg
University of Leeds
Prof. James Tooley
University of Newcastle
Sir Alan Walters

The TPA’s new report, The Bumper Book of Government Waste and Useless Spending 2005, identifies £81bn of wasteful and useless government spending from thousands of sources, including NAO and Public Accounts Committee reports. Major items not identified by Gershon or James include:

  • £2.5bn: Minister for Work Jane Kennedy MP has admitted that a third of the country's 2.7m Incapacity Benefit claimants could work immediately. If they did, taxpayers would save £2.5bn.
  • £2.5bn: In 2003/04, the Government's Rail Regulator concluded that more than £1bn of Network Rail's annual spending was work "that the company does not need to do“ anda further £1.5bn.
  • £2.4bn: The Department for Health has admitted that the NHS national programme for IT (NPfIT) will cost up to five times the previously stated cost of £6,200m over 10 years, implying an overspend of £2.4bn a year for ten years.
  • £1.9bn: £1.9bn of our net contribution to the EU went to subsidising farmers in other European countries.
  • £1.2bn: The Government spends over £12bn a year regulating our lives and businesses. If regulators tightened their belts by 10%, taxpayers would save £1.2bn.

At the launch of the Bumper Book 2005, TPA chairman Andrew Allum said:

“Our detailed analysis shows that the government could have cut £81bn from expenditure in 2004 without sacking a single nurse, doctor, teacher or policeman. These savings should be returned to taxpayers – tax cuts are long overdue.

“Despite the Government paying lip service to cutting Government waste, they actually wasted more money in 2004 than the £50bn waste we found in 2003. With an election coming up, tax rises and government waste will be major issues– taxpayers need to be told the truth as it is their families’ money being wasted.”

TPA Advisory Council member and CPS Director Ruth Lea said:

“Public sector waste is endemic. It burdens the taxpayer and undermines the economy. Any Government worth its salt would tackle it as its first priority.”

ENDS

Notes to editors:

  • Bumper Book 2005:The final draft – pending the full results from the James Review – can be downloaded from
  • Methodology:The Bumper Book 2005 highlights over 75 items of government waste and useless spending, taken from the thousands of examples the TPA collected in 2004. The items are divided into Government departments (e.g. Education) and specific issues (e.g. Information Technology). The figures have been compiled from official reports, government statistics and the media coverage. Each item is fully sourced. Each section begins with the savings identified by Sir Peter Gershon for the Labour Party (in red), David James for the Tories (in blue) and by the Liberal Democrats (in yellow).
  • No double counting:The Bumper Book 2005 includes both Sir Peter Gershon’s savings and David James’ savings but it is important to realise that the Jamessavings we highlight excludeGershon’s – there is no double counting. Similarly, the TPA’s proposed savings are over and abovethe other savings listed. Added together, they come to £81bn of wasteful and useless spending
  • Savings per household: There are just under 24.35m households in the UK. If the £81bn savings outlined in the Bumper Book 2005 were distributed evenly, each household would be £3,326 better off. This would be enough to cover transport spending for the average family (£3,068 in 2002/03, according to the ONS) or their expenditure on clothes and food (£3,395a year).
  • The TaxPayers’ Alliance: The TPA launched in February 2004 as the independent voice for taxpayers in the UK. Further information on the TPA can be found at
  • TPA in the media:Since its launch, the TPA has received media coverage on Bloomberg, BBC Radio 4, BBC Radio 5, Talk Sport, Independent Radio News, BBC News Online, The Economist, The Times, Financial Times, Daily Telegraph, Independent, Guardian, The Scotsman, Sunday Times, Observer, The Business, Scotland on Sunday, Sunday Express, Daily Mail, Daily Express, Evening Standard, The Sun, Daily Mirror, The Star, Daily Record, The People and Tribune and other regional and local newspapers.
  • Further information: Please contact TPA Chief Executive Matthew Elliott on 07795 084 113 or

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