UK cracks down on civil service credit cards after spending quadruples

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Ministers plan to cancel thousands of UK government credit cards in response to concerns about waste after spending on these accounts quadrupled in the past five years to £675mn.

The government will freeze about 20,000 so-called procurement cards, which have been handed out to officials in Whitehall departments and agencies since their introduction in 1997 to purchase necessary, lower value goods and services.

Officials will have to reapply for the taxpayer-funded cards and make the case for retaining them, with about half expected to be cancelled.

The move follows Sir Keir Starmer’s pledge last week to go “further and faster” in reshaping the state and improving efficiency, cutting backroom costs to funnel more money into frontline services.

Senior officials are alarmed that the total expenditure on government procurement cards has more than quadrupled from £155mn in 2020-21 to £675mn in 2024-25.

Chancellor of the Duchy of Lancaster Pat McFadden ordered the review of the cards after “examples of unnecessary spending” came to light, according to the Cabinet Office.

This included thousands of pounds spent by officials on meals at private members’ clubs, crystal glassware, items from luxury department store Fortnum & Mason and English sparkling wine.

In particular, transparency data published by the Foreign, Commonwealth and Development Office recorded purchases that have raised eyebrows among government insiders.

The FCDO purchases included £2,479 spent at DJ Superstore, a UK-based DJ equipment dealer, in November 2022. Officials said the money was spent on lighting for the UK embassy in Doha for an event promoting Britain.

“It’s not right that hundreds of millions of pounds are spent on government credit cards each year, without high levels of scrutiny or challenge,” McFadden said. “Only officials for whom it is absolutely essential should have a card.”

McFadden added that the clampdown will deliver savings that can be channelled back into the government’s priorities, including securing the UK’s border and improving the NHS.

New curbs will be introduced on any cards that are approved from this month, including a reduction in the maximum spend for hospitality from £2,500 to £500. Any expenditure over the new limit will require director-general sign off.

There will also be a ban on civil servants using the cards to buy goods for which there is an existing departmental or cross-Whitehall procurement route, which is likely to offer better value for money, such as travel expenditure and office supplies.

Mandarins have been instructed to launch disciplinary action against officials found to have deployed the taxpayer-funded cards in ways that go against formal guidance about their use.

Diplomatic staff working in conflict zones who require the use of their government credit card for specific operational purposes will be exempt from the freeze.