By Jason Lower - 6th October 2011
The Foreign Office spent £2.6bn in 2010-11, with £0.51bn devoted to conflict prevention, a report by the National Audit Office has revealed.
Spread over 270 overseas posts, the department has approximately 15,000 staff, with 5,000 UK-based civil servants.
Public diplomacy is conducted through bodies such as the British Council and the BBC World Service. £0.27bn is spent annually on the international broadcaster, which from 2014 will come out of the BBC's domestic budget.
The department also works with other government departments such as the UK Border Agency, Ministry of Defence and Department for International Development.
Overall, the Foreign and Commonwealth Office group managed to achieve £144m worth of efficiency savings, beating its target by £32m.
The report highlighted how overseas posts' budgets were subject to currency fluctuations and local inflation. This has been affected particularly by the withdrawal of the Overseas Pricing Mechanism (OPM) and the subsequent decline in the value of sterling.
Foreign exchange risk is now managed centrally, with post budgets being in local currency.
The dawn of the coalition heralded a new Foreign Currency Mechanism (FCM) which will take effect from 2011-12 to 2014-15, with the department being compensated for falls in the value of sterling and having to return money to the Treasury when the value rises.
The report identified a variety of issues that affected the department, ranging from the physical security of premises due to the crises in North Africa and the Middle East and health and safety, to the monitoring of costs associated with utilities abroad and the vulnerability of paper records held at Hanslope Park, where FCO services are based.
The report also made note of the new indicators being used by government departments, broadly falling into two categories, those of 'input' and 'impact'. The first assesses the resources being used in delivering services, while the latter helps judge whether policies are having the desired effect.
While the report claims it is too soon to interpret the effectiveness of these indicators, it identified some elements outlined by the House of Commons Committee of Public Accounts, including the importance of clear definitions of expected outcomes and standards and strict timelines.
In another report, 'Managing staff costs in central government', the NAO has highlighted the FCO as a good example of managing staff costs, with a phased project to improve its information systems relating to staff skills.
Overall, the FCO's biggest five projects were IT (£82m), Future Firecrest, to update global IT infrastructure (£10m), office refurbishment (£19m), a new embassy (£29m) and a new British High Commission Office (£27m).
Reporting on the Civil Service People Survey, the NAO highlighted the engagement index, an assessment of the extent to which staff feel emotionally attached and committed to the organisation, as well as whether they speak positively of it and are motivated to do their best.
In 2010, the FCO managed to beat the civil service average of 57 per cent by 11 points, just one down from the 2009 score of 67.
Have your say...
Please enter your comments below.