Issued by: Cabinet Office

The Cabinet Office instructs departments and their agencies to freeze almost all of around 20,000 Government Procurement Cards as part of plans to cut spending

• Thousands of government credit cards will be cancelled, cracking down on wasteful spending in government in favour of delivering the Plan for Change.

• Departments and their agencies will be instructed to freeze all cards this week, with a tough new application process to cut the numbers in circulation by at least 50%.

• Spending on the cards has quadrupled in four years.

• Move follows PM’s intervention last week to go further and faster to reshape the state and make it deliver for working people.

Thousands of government credit cards will be cancelled under plans to cut spending and ensure every pound of taxpayer money is targeted at delivering for the public.

The Cabinet Office will instruct departments and their agencies to freeze almost all of the around 20,000 Government Procurement Cards in circulation this week, with Civil Service cardholders forced to reapply and justify that they really need them - if they don’t the cards will be cancelled by the end of the month.

Only a minority of cards, used for specific operational purposes such as by diplomatic staff working in unstable environments, will be exempt from the mass freeze.

A strict new application process will be introduced, with departments told to approve the minimum number of new cards possible. It is expected the number of cards will be reduced by at least 50%.

Chancellor of the Duchy of Lancaster Pat Mcfadden said:

"We must ensure taxpayers’ money is spent on improving the lives of working people.

"It’s not right that hundreds of millions of pounds are spent on government credit cards each year, without high levels of scrutiny or challenge. Only officials for whom it is absolutely essential should have a card.

"Our clampdown on government credit cards will deliver savings that can be used to drive our Plan for Change - securing our borders, getting the NHS back on its feet and rebuilding Britain."

This follows the Prime Minister’s intervention last week where he said the Government must go further and faster to reshape the state and make it work for working people.

The move is part of a civil service wide efficiency drive to cut down on wasteful spending across government, which includes making it quicker and easier to remove poor performers from post.

It will ensure resources are targeted at delivering the Government’s Plan for Change - ending hospital backlogs, putting police back on the beat and securing the country’s borders.

While some credit cards are operationally necessary to deliver services, the amount spent on them has more than quadrupled in the past four years with spending in the last financial year reaching over £600 million in central departments and core agencies.

The move aims to reduce the money spent on Government cards, redirecting business critical spend into more appropriate procurement routes that deliver better value for money.

Tighter new spending controls will also be introduced, with the maximum spend for hospitality - often needed for officials working in trade or diplomatic roles - slashed from £2500 to £500, and any spend over £500 requiring Director General approval.

Civil servants will also be banned from using cards where there is either a departmental or cross-Government procurement route. These procurement routes deliver better value for money by procuring at scale for common goods and services, like booking official travel, training, or office supplies.

Chancellor of the Duchy of Lancaster Pat McFadden ordered a review of the cards after examples of unnecessary spending were highlighted.

Departments have been asked to review spending on Government Procurement Cards by their officials. Where they identify examples of spending on cards found to be incompatible with guidance they have been told to take action, including disciplinary action and the revocation of the card in question.

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