For every pound of public money spent on construction, the Government has said it will deliver up to 20 per cent more by 2015 because of its smarter approach to building public projects.

New data published today reveals that departments have already saved £188 million on construction contracts placed in the past 18 months, and sets out how the Government will reduce these costs even further over the next three years.

The data shows that the costs of building projects such as schools and hospitals are set to fall by 15 to 20%. The reductions are part of the Government’s five year construction strategy, which takes a long term approach, including a focus on waste, greater transparency on costs, new models of procurement designed to foster collaboration and innovation, and smarter use of technology.

The Government has already published its forecasted spend on construction up to 2015, setting out plans for around £8 billion worth of projects in each of the next three financial years. The Cabinet Office said the cost data will not reduce the overall amount to be invested in construction but will mean that taxpayers will get more for this money.

Successfully delivering projects at 15 to 20 % less than the historic benchmark, while holding to its budget, would mean that the public sector could be building £1.2 – £1.6 billion worth more in projects by 2015 - equivalent to approximately 60 new secondary schools.

The published data is intended to provide a standard average cost for projects that the public sector will use to set budgets, making value for money a clear driver in launching projects, and challenging industry to “beat the benchmark”.

Minister for the Cabinet Office, Francis Maude, said that while the Government would keep investing in the construction industry it wanted to stamp out wasteful variation in costs and help to create a stronger cost lead for the industry. He said:

“Publishing this data on costs will give the public sector a vital planning and bargaining tool as well as setting a challenge to the industry. Setting out clear costs to industry challenges construction firms to innovate and come up an idea that offers both lower cost and better value."

Chief Construction Adviser Paul Morrell commented:

"Every element of our plans is designed to improve value in public sector construction. I believe we are seeing a fundamental shift in the way the Government relates to the construction industry: in short, getting a more intelligent answer by asking a more intelligent question.

"We also need to learn the lessons from projects that go well and apply them consistently to drive out unnecessary cost and waste in the construction process – not just by streamlining processes, but by being more innovative in the way Government approaches its construction programmes.”

Alongside the new data, the Government has also published details on some of the innovative construction delivery and procurement models being trialled in areas such as defence, justice and flood defences.