Government plans for public sector property drive the force for change...

Published on Fri 24 Apr 2009

The received wisdom is that it is the private sector that is the major innovator in the economy. So, it follows that it is the public sector that looks to commercial organisations for pointers and inspiration, a guide to the way ahead.

Well, we should always question ideas like this one because when it comes to making innovative decisions about property, it is the public sector that appears to be driving change every bit as much as the private sector - and maybe more so. For example, the Government announced during 2008 that it had worked out how it could save itself about £1.25 billion a year by moving the desks around. That’s enough to build 42 new schools or 8 new hospitals every year.

Then, in his Budget speech in April of this year, the Chancellor announced that he would push things even further, as a way to help attempts to save money in light of the current economic climate. In his speech he challenged the public sector to make billions of pounds of efficiency savings as well as raise £16 billion from property disposals. As well as a reduction in running costs of £1 billion per year, the Treasury is also suggesting that the size of the government’s property portfolio could be reduced by 20 per cent over the next ten years, which would achieve an additional reduction in running costs of somewhere between £2 billion and £4 billion.
Although making headlines in 2009 in the wake of the Budget, the idea has been around for at least twelve months. The original basis for some of these astonishing figures was a report published by the Office of Government Commerce (OGC) in 2008 which urged the occupiers of public sector offices to change the way they allocate space amongst other things. (The OGC is part of the Treasury and according to itself is ‘responsible for improving value for money by driving up standards and capability in procurement, from commodities buying to the delivery of major capital projects, maximising the effective use of 60 per cent of Government spending and a £30 billion property estate.’)

The report it produced last year with property specialist IPD - Efficiency Standards for Office Space – made a number of recommendations, some of them quite remarkable. For example, it said that the entire government estate should be subject to an overhaul in the way it used space with the aim of saving around £1.25 billion of its yearly running cost. What was particularly intriguing was that it saw interior design as being central to this aim, specifically by addressing the way that space was allocated in its offices.

The standard the report exhorted organisations to adopt was around 10 square metres per person for all new office buildings and major refurbishments of existing buildings and 12 square metres per person for other projects. Public sector space allocations have typically been around an average of 14.5 square metres per person.

The proposed lower space standards do not just represent a cost saving. They can also make a significant contribution to the environmental performance of a building. These intertwined principles are already fairly well established in the private sector where office densities in the UK have risen from around 15-16 square metres per person to around 10 square metres or less per person over the last few years. The logic for this change is clear. Firms are using less space to support more people. The reason they are doing that is to save money. And the thing that allows them to do all of this is new technology.

It is mobile technology that is typically seen as the main catalyst for these changes, but the changes wrought by the ubiquity of flat monitor screens have been no less profound. Flat screens do not need the same amount of worksurface as cathode ray tubes, either for their own bulk or for to meet the ergonomic requirements of users. By all estimates, the flat computer screen has helped to flatten workstation footprints by and allowed occupiers to look at increasing occupational densities or changing the way they use space significantly.

According to the OGC website: ‘High Performing Property is the five year strategy for improving the efficiency and effectiveness of the management and use of the government estate, and for achieving a more sustainable estate. Benefits from the programme are estimated to be worth between £1billion-1.5billion per annum by April 2013 on an estate that costs around £6billion a year to run. Savings will arise from a reduction in overall space required, better space utilisation and better procurement of FM services and property leases.’

With the implementation of these principles, public sector buildings should become more sustainable, more user-friendly, more productive and more cost effective. Ultimately, thanks to the combined efforts of Government, manufacturers, designers, suppliers and managers, well designed, fitted-out and managed workplaces should become a vital component of public sector work. And in pushing forward such an innovative agenda, it could well be that the public sector will blaze a trail for the private sector to follow.