HM Revenue & Customs' PaceSetter Programme, aimed at streamlining business operations, has improved productivity through new ways of working and may have contributed to greater staff engagement. However, the National Audit Office has concluded that the Programme is not yet value for money because the extent to which efficiency has improved is not clear; and some key principles of process improvement are not yet being applied strategically across the entire organisation and embedded into the Department's core processes. PaceSetter, introduced five years ago, is designed to help HMRC change the way it works, to deliver more for less resource. The Department has pioneered the use of process improvement techniques in central government. Improvements include the redesign of claim forms and the standardisation of procedures across offices. The Department estimated that PaceSetter produced productivity improvements, with over £400 million of resource savings and £860 million of tax yield. It is not clear, however, if reported savings represent overall efficiency improvements, in part because of the limited evidence on overall trends in business performance. The PaceSetter Programme has had a small positive impact on staff engagement but overall it is still low. HMRC does not have a full understanding of the costs of PaceSetter. The Department decided to monitor only certain of the costs excluding the salary costs of its own PaceSetter experts. NAO analysis shows a more complete assessment of costs brings the total spent on PaceSetter from £55 million to at least £115 million between 2005-06 and 2010-11.To maximise the benefits of PaceSetter, the Department needs to use the Programme to help it streamline its business operations in a more strategic way.
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