Public Services > Central Government

Government announces cost per transaction for major services

Charlotte Jee Published 17 January 2013

Data covers £1bn transactions per year, 88% of the total number processed by central government


The government has announced the cost per transaction for some of the biggest services it provides to citizens and businesses. The data for 44 services have been released and, taken together, they account for over a billion transactions every year, which amounts to 88% of the total handled by central government.

The transactions, details of which were released today cost the government just over £2bn a year to run.

HM Revenue & Customs (HMRC) accounts for the top five transactions by annual volume. The service with the largest number of transactions per year is Stamp Duty Reserve Tax, which is paid on electronic 'paperless' share transactions, and costs on average 5p per transaction. There are 438m such transactions every year.

The cost-per-transaction data released today covers a wide range of public services, including Child Benefit claims (of which there are 5.4m relevant transactions a year, costing £6.20 each on average), visa applications (with 3.4 transactions which cost roughly £225 each), practical driving test bookings (1.9m transactions at £1.10 each) and student finance applications (1.12m transactions costing approximately £46.58 per transaction).

In another example, vehicle excise duty (vehicle tax), which accounts for 46m Department for Transport (DfT) transactions a year, costs £1.28 per transaction on average.

Just seven departments are responsible for approximately 90% of central government transactions: HMRC, the Department for Transport (DfT), the DWP, the Department for Business, Innovation and Skills, the Department for Environment, Food and Rural Affairs, the Ministry of Justice, and the Home Office. HMRC oversees 978m transactions per year, with the DfT handling 94m and the DWP taking responsibility for 52m.

Although the Department for Work and Pensions (DWP) has reported that it handles 40m Jobseeker's Allowance transactions every year, it has not included figures on the average cost associated with each transaction. Indeed, the DWP has not provided average cost per transaction for any of the five services included in today's data release.

Although not included in today's figures, which focus exclusively on central government, it is worth noting that local government accounts for 572m transactions each year.

However, according to the Cabinet Office, "Comparing services is a complex matter. The most expensive service is not necessarily the least efficient. For example, the Passport Applications service costs £64.68 per transaction, but is a highly complex process involving identity checks, secure printing of passports, postage and multiple channels, both online and offline.

"The Statutory Off-Road Notification (SORN) service, on the other hand, is a much simpler transaction that can be done completely online and costs just £0.47 per transaction."

Minister for the Cabinet Office Francis Maude said, "Making this data public is an important step for transparency and ensuring government is accountable for the cost and efficiency of the services it provides. The UK government has never done this before and, as far as we know, no other country systematically tells its citizens how much they pay for the services they use. For example, to pay car tax, apply for a passport, or file annual business returns.

"This data sets a baseline for service performance - something the public can, and should, judge our progress on as we move to making all government services 'digital by default', as set out in the Government Digital Strategy and the departmental digital strategies published at the end of last year.

"Making government digital is also at the heart of our plans to reform the Civil Service, helping it to work in new, faster, more efficient ways, be smaller, more open and less bureaucratic."

Mike Bracken, Executive Director for the Government Digital Service (GDS), said, "At the Government Digital Service our focus is always on users. Greater visibility around service performance - including cost per transaction - is an essential step towards delivering digital services that are simpler, clearer and faster. We are working closely with departments to transform key public services and help them to become digital by default."

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