The DfES is supposed to be making £4.3bn in savings as its contribution to meeting the government’s Gershon Efficiency Review.

This House of Commons’ Education and Skills Select Committee raised the issue, when they recently released their review of DfES spending. What confused the Committee was the National Audit Office’s description of what savings actually are. According to the NAO, savings are both ‘cashable’ and ‘non-cashable’. Cashable are ‘reductions in inputs, which do not adversely affect the quality of outputs’. Non-cashable by contrast are gains ‘where the quality of outputs increases while inputs remain the same’.

Confused? Well you’re in good company, as the Committee commented, ‘This does not seem to be money as it is normally understood’. So how is the DfES going to save £4.3bn? 75% will come from recyclable non-cashable gains. If we’re correct this means the DfES has to only find £1.075bn worth of real savings. Perhaps the DfES can explain away the difference as new maths?