The government is stuck with “unbreakable” leases above market prices for offices that may not even be needed.

MPs warned that taxpayers risk being stuck paying for long-term, expensive real estate to house officials and other government agencies.

This is because the state-owned real estate agency, which is responsible for property management and future needs, is being “punched” by outdated IT systems and a lack of understanding of how much office space is needed, as many employees are currently overworked. from home. Pandemic instead of a trip to the office.

A report by the influential Parliamentary Accounts Committee (PAC) accuses the UK Revenue and Customs Service (HMRC) of wasting tax revenue by agreeing to sign non-breakable leases of up to 25 years for over 25 years under the government’s notorious tie-in hub scheme Current Market Rent Distribute Whitehall staff across the UK.

The central government owns real estate, from hospitals to schools, courts and prisons to museums. The portfolio is valued at £158bn – one of the state’s largest assets – with operating costs of £22bn a year, although MPs said they were unable to pinpoint annual maintenance costs and instructed Cabinet to provide a detailed breakdown.

The committee said a new computerized property database to improve the efficient management of the UK’s vast public property of more than 136,000 buildings has been repeatedly delayed and is currently hindering the management and maintenance of public buildings.

Landmark Solution, which is building the new database, said it was unable to secure a contract despite an extension due to staffing issues during the pandemic. The Cabinet terminated the contract in July 2022 but has not yet named a new contractor and has not been able to tell MPs when the new system will go live or what it will cost.

MEPs noted that the current state property database, the 17-year-old ePIMS system, cannot contain enough data for all state property. Attempts to update the system have so far been unsuccessful, and until the new system is up and running, the Cabinet of Ministers will continue to manually collect property data from individual departments.

Sir Geoffrey Clifton-Brown MP, Deputy Chairman of the Committee, said:

“The whole plan for a network of government offices across the UK seems to be falling apart, with sweeping changes to office space usage and rents, but Cabinet simply doesn’t have enough understanding of the facts on the ground to adapt.

“HMRC itself is losing hard-earned tax revenue by taking on an inflated, unbreakable 25-year lease on six major office centers despite our concerns about the practice, which was warned about before the Covid pandemic.”

“The government is pursuing the idea of ​​subleasing excess space, which is now much higher than the market rent. He added: “The PKK has already warned that he just won’t get away.”

PAC said it was skeptical of the government’s vaunted “money saver centres” scheme, which is moving staff from small offices to large modern centers in cities across the UK. The government plans to open 30 to 50 centers, but MPs note that demand for office space has slowed since the pandemic and it remains unclear what long-term impact this will have on commercial rent.

They warn that the government’s incomplete information about the number of employees using the offices poses a threat to the project. GPA has calculated from the data that they have reduced office usage by at least 25 percent, which could mean fewer or smaller hubs will be needed in the future.

Ministers hope the Hubs plan will free up excess property they plan to sell. By 2025, the company plans to raise £1.5bn through the sale of surplus properties, which will then be reinvested in the estate.

But MPs say detailed plans to reach the goal have yet to be made public, and market volatility could affect the plan. “Cabinet officials acknowledged such risks and assured us that there would be no forced sale of assets,” the statement said.