Government racks up £5bn losses with Ministry of Defence most wasteful

The government spent £5bn more than was budgeted by Parliament last year, bringing into question Whitehall efficiency.

The Ministry of Defence was the most profligate department - incurring losses of £3.1bn - after spending millions on doomed projects including £6m on faulty ear plugs and another £4m axing Sea King Helicopters.

A report by the TaxPayers' Alliance found the Department for Health wrote off £49m exchanging its Tamiflu vaccine stock and that £1.2m was lost when a school paid the sum into the wrong account.

Other losses included:

• The Department for Work and Pensions lost some £569m and the Department of Business, Innovation and Skills incurred losses of £469m
• Departments ran up a bill of £157m in "Special Payments" as a result of unforeseen but often avoidable events - £50m of which was accountable to the Home Office
• Vaccine write-offs that cost the Department of Health £255m.

While some of the losses may have been accountable to other public sector organisations, the report shines a light on how millions of pounds were frittered away at a time when political parties are attempting to persuade the public the economy is safest in their hands.

Jonathan Isaby, chief executive of the TaxPayers' Alliance, said:

"While in some cases closing a programme or getting out of a rental agreement early may make long-term sense, many of these losses are simply ludicrous and will seriously damage the trust taxpayers have in Whitehall civil servants.

"It is clear there remains far too much waste in the system. With an ever-growing debt burden, we must make government more efficient and ensure taxpayers are getting real value for money."