EEDA - East of England Development Agency

The government's Spending Review 2004 set targets across the whole of government to achieve annual efficiencies of at least 2.5 per cent per annum.

As part of this process, and contributing to the then DTI commitment to achieve efficiencies of £380 million by the end of 2007/8, all regional development agencies were required to produce efficiency plans covering the period 2005/6 to 2007/8, setting out their approach to efficiency and an action plan to secure the target of 2.5 per cent year on year for this period.

EEDA's efficiency plan was approved in June 2005. Efficiencies set out in the plan were required to be categorised into cashable and non-cashable, and into administration and programme.

Cashable efficiencies comprise those that result in a direct financial saving or benefit with monies released able to be recycled to other parts of EEDA to deliver better results/outcomes consistent with regional and corporate objectives. At least 50 per cent of the savings target was required to be cashable.

Non-cashable efficiencies are those gains that do not necessarily result in lower costs but which lead to improved performance for the same level of resources/inputs.

Administration savings are those in respect of the underlying running costs of the agency, while programme savings are those arising in the delivery of programmes and interventions of the agency.

A methodology for measuring non-cashable programme savings was agreed with DTI based on a target level of outputs representing at least a 2.5 per cent increase in delivery compared with a baseline developed from achievements in 2004/5.

Achievements in 2007/08

EEDA's efficiency plan included a range of initiatives intended to realise significantly more than the minimum target of 2.5 per cent in both 2005/6 and 2006/7. In addition to providing a certain level of challenge, this also provided an in-built contingency should some of the identified initiatives not to be practicable or realisable in full. Cashable efficiencies exceeded targets by £0.5 million in the first two years of the plan and the equivalent figure on the non-cashable programme was nearly £4 million.

In 2007/08, total savings exceeded the target by £5 million due to the increased level of outputs generated (details of which are reported above). The significant achievement over target in respect of non-cashable savings is due to the efficiency savings being measured against the baseline set in 2004/5, whereas EEDA has since continued to increase its own output targets to reflect increases in performance. The methodology for efficiency reporting, however, continues to use the baseline established in the original efficiency plan approved in June 2005. Cashable efficiencies fell short of their in-year target by £0.3 million although, across the three years of the programme, administration and cashable savings in total both exceeded their targets.

The final savings/efficiencies secured in 2007/08, and for the cumulative three year programme, can be summarised as follows:

For the period of CSR 2007, the efficiency agenda within RDAs is being taken forward through new Value For Money plans which will agreed with DBERR in late summer / early autumn of 2008.