Make a new plan, Stan: 50 ways to reduce your spending

The enthusiasm with which the government has embraced crowdsourcing to generate ideas for saving money – or cutting services, depending on your perspective – is I think a good thing, despite an increasing amount of cynicism in the blogosphere. Hopefully most of the critique is aimed at the green ink brigade or as Liberal Conspiracy notes, the CAPITAL LETTERS brigade. The latter are perhaps the downside of participatory democracy, leading to what might be more accurately termed mobcutting than crowdsourcing. Which is a shame, as these exercises are coming up with some good ideas: at the Pro Bono Economics annual lecture last week (which by the way was rather good), Gus O’Donnell mentioned that 80% of the ideas were serious. So what are the ideas coming through? And more to the point, are they ideas that can be used by voluntary organisations? The Treasury has highlighted 31 example ideas. I’ve grouped and summarised the ones that are not specific to government:

  1. Share back office functions. Occupy less space in buildings, and find buildings in cheaper places. There is an increasing amount of research from the US Nonprofit sector on this. If someone pushes me, I’ll blog about it…
  2. Procurement: share information between departments when procuring stuff or consultants. Give departments the freedom to purchase goods and services where they cheapest – not via central purchasing or an expensive intermediary. Insource activities that are undertaken by expensive external consultants.
  3. Renegotiate your contracts, esp IT. Ensure procurement processes don’t unintentionally deter new suppliers. Renegotiate your mobile phone contracts.
  4. Divert to the front line. Stop spending money on marketing services that citizens don’t really have a choice in using; spend it on the front line.
  5. Spend less on energy. Switch PCs off at night (I know NCVO did this and saved £lots). Switch the lights off at night.
  6. Reduce administrative duplication. Make CRB checks portable.
  7. Stop/change printing. Print forms at the time and location where they are needed. Stop colour printing by default (another thing that NCVO did that saved £lots, esp when we moved to fewer, larger printers). Stop producing publications in electronic and paper format. Only do the former.
  8. Reduce licencing costs. Use open source software.
  9. Trim hours. Offer staff the opportunity to reduce their hours, don’t just rely on the standard 35/40hr week. Reduce management numbers before frontline staff.
  10. Spend money like it’s your own. Reduce overnight expenditure allowances – eg stay in a budget hotel, don’t travel first class.
  11. Change the budget culture/disincentives. Eradicate the “spend it or lose it” approach to budgeting.

In an excellent piece for Society GuardianIan Tucker observed that many of these ideas “are common sense …Unsurprisingly the ideas are mainly concerned with the trees rather than the woods. The big, radical and often painful stuff – that, it seems, is for the ministers.” Which is an interesting point: these are largely incremental ideas that each might shave off 0.1% of the budget. But as the British Olympic Cycling Team found when winning so many gold medals, it’s the cumulative effect of these savings that when combined can make a substantial difference.

To return to Gus O’Donnell’s lecture, which focused on the importance of trust, managers are going to need to trust that staff know where to find these savings, rather than just crowdsourcing them and handing them out in the usual command and control approach. Otherwise, this could turn into a rather large game of rock paper scissors.

I’m guessing that some readers (apparently I still have some) will at this point be arguing that this sort of cheeseparing isn’t going to do the business.  If you prefer a different appoach, I would strongly recommend that you start with the ever-reliable Young Foundation and in particular their 12 economies framework. This highlights a dozen ways to change what the public (and voluntary?) sector could do to make more significant savings. This includes stopping doing some things completely; trimming services; delaying some activities; scaling-up; and so on. Whilst some of these categories overlap, this is nevertheless an interesting approach.

Using a slightly different approach, NESTA’s Radical Efficiency report also contains a framework for thinking about how to cut. This shares ideas with both the Treasury crowdsourcing effort and the Young Foundation’s 12 economies, such as looking for new suppliers. In asking organisations to rethink where ideas come from it is endorsing the Treasury approach. What I like about the NESTA report is the idea that we can tap into latent resources that we take for granted, though some voluntary organisations might question whether they can learn from this. Nevertheless, like much of NESTA’s research, Radical Efficiency is excellent and well worth a glance.

These are the thing’s I’ve read so far that might help us think through how to do things differently. Do you have any suggestions on useful guidance that you’ve seen?

Photo: Copyright of I*adore, taken from Flickr I would like to acknowledge Tony Bovaird and Patrick Butler for tweeting the article by Ian Tucker, which gave me the idea for writing this blog. Apologies to Paul Simon for the title of this blog. And finally, I’ve got an idea for nudging voluntary organisations to save money…if only I could get a trust or foundation to take it on…!

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Karl Wilding Karl Wilding served as NCVO's chief executive from September 2019 to February 2021.

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