Advertising spend under threat in Chancellor’s efficiency drive

The Government’s &£307.5m advertising and promotion spend is expected to come under serious threat, as Whitehall departments face up to meet Gordon Brown’s efficiency targets urging them to cut costs.

The Treasury has indicated that the departments will need to have a serious think about their advertising and marketing budgets to meet the looming 2008 deadline.

Chancellor Brown ann-ounced a comprehensive spending review in 2004, setting a target of &£21bn savings to be achieved every year by 2008. A Treasury spokesman says that “as various departments plan for cost savings, they will be forced to look at advertising to ensure more value for money”.

“The cost savings from redundancies will account for one-third of the total savings.”

It is understood that most government departments have already initiated spending reviews of their supplier arrangements, including advertising and marketing, to meet the 2008 deadline and to seek better value for their advertising budgets.

All Whitehall departments, except the Department for Transport, use COI Communications to handle their advertising and marketing. The DfT broke away from the COI in 2002 as it argued that it delivered best value to the taxpayer without the involvement of the COI.

A spokesman for the Department for Culture, Media and Sport adds: “When we start looking at cutting costs, advertising and marketing will be very much on the agenda for us.” It has been rumoured that the Home Office and the Department of Health have already been looking at creating an independent roster, outside of the COI (MW April 7, 2005).

A COI insider denies that moves are being made by the government departments to review their advertising spend.