Economy · Budget & tax · 24 October 2026
Government sets new rules for tracking departmental efficiency savings
The Government Efficiency Framework defines how departments must calculate and report efficiency savings, according to House of Commons Library. The rules require savings to be sustainable and supported by high-quality data. Departments must report these figures to HM Treasury and, from 2026/27, to Parliament.
House of Commons Library has published details of the Government Efficiency Framework, which establishes the definition of efficiency and the requirements for public sector departments to track and report savings. The framework clarifies that efficiency means spending less to achieve the same or greater outputs, or achieving higher outputs while spending the same amount. Reducing the amount of output achieved does not count as an efficiency saving, even if less money is spent.
Departments must track their savings against targets set at the 2025 Spending Review, which call for £13.8 billion in efficiencies by 2028/29. Figures published with the announcement show that in 2025/26, departments made £9.2 billion in efficiencies, with over a quarter achieved through redesigning policy and services. The Department of Health and Social Care had the highest amount of efficiencies among all departments.
Recognised efficiency savings must be sustainable, supportable with high-quality data, and not merely push costs elsewhere. Most departments intend to make savings through digital technology, workforce changes, and estate changes. The framework requires savings to be reported to HM Treasury and, from 2026/27 onwards, to Parliament.
The announcement does not specify which other departments will follow the Department of Health and Social Care in achieving the highest levels of efficiency, nor does it detail the specific digital technologies or workforce changes each department will implement to meet the £13.8 billion target.
Written by StreetOwl from House of Commons Library’s own announcement. It was drafted by StreetOwl’s own model, every figure and quotation was checked by code against the announcement, and it was read and approved by Michael Rossi before it went up. It says what was announced, not what anyone should do about it.
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