Cabinet Office Controls: Version 7
This policy summary outlines the objectives, benefits, scope, and the responsibilities of your organisation when using the Cabinet Office spend controls.
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Cabinet Office Spend Controls policy: Version 7
Central government organisations, including departments and the bodies they sponsor must obtain Cabinet Office approval when they want to spend money on specified activities.
Cabinet Office spend controls are part of the wider government financial delegations and approvals process and are an important part of the mandate of the government functions. The Cabinet Office operates the spend controls on behalf of HM Treasury.
Objectives and benefits
Cabinet Office Spend Controls provide enhanced assurance on significant and complex areas of spending.
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enabling government to operate in a much more holistic and joined-up way - the Spend Controls promote the reuse of technology; interoperability; common terms and conditions; and efficient and collaborative asset utilisation.
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highlighting patterns or duplicated spend within and between organisations - the Spend Controls build visibility of spending in particular categories, generating insight.
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supporting the implementation of government policies and strategies such as the government estates, shared services strategies and functional standards.
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targeting expertise and additional assurance at complex and risky areas of spend, thus improving the specification of spending proposals and ensuring alignment with government priorities.
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identifying issues which, while outside the scope of functional assurance, could point to the need for HM Treasury approval such as proposals that are novel, contentious or repercussive.
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Spend Controls benefit organisations and the government as a whole. They help to deliver savings and efficiencies, increase delivery confidence, reduce risk, support capability improvements and help ensure improved outcomes for citizens.
Scope of the Spending Controls
Organisations in scope of the Spend Controls
All central government organisations, including departments and the bodies they sponsor, must obtain approval from the Cabinet Office when they want to spend money on specified activities. New organisations are expected to comply with the Spend Controls unless specifically exempted when set up. Details of exemptions to spend controls are detailed in Annex A.
The Office of National Statistics (ONS) public sector classification guide is used to determine which organisations are categorised as central government. This includes: all central government departments, including non-ministerial departments; executive agencies; and other arms-length, non- commercial bodies that are majority controlled and/or financed by departments (Non-Departmental Public Bodies).
Organisations outside central government may, exceptionally, be subject to Spend Controls if this is specified in legislation, the memorandum and articles of association or in a contract or grant agreement.
Organisations out of scope of the Spend Controls
All organisations not classified as central government are outside the scope of spend controls (subject to the above exceptions). This includes private sector organisations, devolved administrations, public corporations (public sector market bodies) and local government bodies.
Expenditure covered by the Spend Controls
The Spend Controls apply to commercial contracts, general grants and individually specified types of transactions. Excluded are payroll and staff costs, budget transfers, recharge arrangements, Grant In Aid allocations and formula grants. The provision of data via the grants pipeline is included. These transactions may still be subject to wider spend controls operated by HM Treasury.
Exemptions from Spend Controls
There is a presumption that all central government organisations are subject to all of the Spend Controls (unless specifically excluded at formation, e.g. through the founding legislation). In exceptional circumstances, exemptions may be granted to specific organisations within scope in respect of some or all of the Spend Controls. Your organisation may request an exemption from the Spend Controls from the Cabinet Office. Such requests will be considered on a case-by-case basis and must be approved by Cabinet Office and Treasury ministers.
Agreements of any exemptions a body holds from the Spend Controls should be recorded in the department’s delegation letter and in the Framework Document, or similar relationship-defining document, between the body and its sponsor department. Where the Framework Document is silent, it should be assumed that all of the Spend Controls apply.
Exemptions will be reviewed regularly, either: at a date specified in the letter granting the exemption; when the status of the body changes; when the framework document is reviewed and updated; as part of the department’s review of ALBs; or where issues are identified that suggest shortcomings in internal controls.
Exceptional factors will be considered when granting exemptions and organisation may make requests to the Cabinet Office for consideration.
Triggers
The Spend Controls are triggered at defined thresholds and approval points.
Thresholds
For expenditure within the scope of Spend Controls, approval must be sought where the relevant financial threshold is reached.
The threshold level varies depending on the expenditure category, complexity and specific agreements with individual organisations. Additional details on threshold policy can be seen at Annex B.
Financial thresholds
The financial threshold relates to the relevant contract or transaction. It does not relate to total project or programme expenditure, which will include other costs and cost categories.
The threshold value may relate to aggregate spending where contracts are changed or extended.
Delegation Letters may include bespoke arrangements where the threshold is higher or lower than set out under types of spend in scope.
The organisation is responsible for ensuring that all spending within scope of the Spend Controls is submitted for approval.
Bespoke thresholds
The default position is that the financial thresholds set out under types of spend in scope apply to all central government organisations. Variations on thresholds may be agreed with individual organisations where appropriate.
Factors that will be considered include: assessments of capability and adherence to standards; the size and scale of spending activity; compliance of the organisation with Spend Controls; and any exceptional circumstances such as bodies set up to respond to specific events or emergencies. Consideration of different thresholds will be at the Cabinet Office’s discretion, and usually given at the point an organisation becomes subject to controls or where there is clear evidence that current thresholds are no longer appropriate. These changes will need to be agreed with the Cabinet Office and HM Treasury.
Approval points
Approval point timing
The Cabinet Office does not direct but advises organisations on commitment to expenditure. Spend approval is required in real time, before contractual commitment is in place. First engagement is at the Outline Business Case stage though to the Full Business Case stage and continues where extensions to existing contracts are proposed.
Organisations or ALBs should engage with the Cabinet Office as early as possible. Early review and assurance means there is a greater opportunity for functional experts to add value, resolve issues, and form submissions ready for approval.
Early engagement should be undertaken through forward looking spending pipelines, and may be supported by a Strategic Outline Business Case or Programme Business Case. Where assurance is undertaken as part of the pipeline approach, the Cabinet Office will decide whether approval is required at the point that spend is committed.
Joint approvals
Where proposed spending would trigger more than one spend control, organisations should alert all the relevant Cabinet Office functional assurance teams. The functions should then liaise with each other and the central controls team to ensure that each control is considered. Approval to spend should not be granted until the case is approved explicitly under all relevant controls.
Expectations and principles
All central government organisations are expected to comply with the letter and the spirit of spending control policies and procedures. The following expectations and principles apply to organisations subject to the Spending Controls:
Expectations
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Pipelines - Organisations must develop and maintain spending pipelines covering planned expenditure for the following 15 months (minimum). This is a requirement for commercial, digital and technology, grants, facilities management and property activities and good practice in other areas.
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Internal assurance and approval - Organisations must ensure robust internal assurance and approval processes for spending activities.
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Standards - Organisations must use functional standards to ensure clear accountability, sufficient capability and expected practices support the development of spending proposals.
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Real-time controls - Organisations must ensure timely engagement with the centre to ensure that controls apply in real time, before spend is committed.
Principles
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If in doubt, assume controls apply - All central government organisations are considered to be in scope of all Spending Controls unless a specific exemption is granted by the Cabinet Office. If in doubt, or where emergency procedures apply, organisations should assume Controls apply and engage with the central teams. Contact details can be found at the bottom of this guidance.
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Transparency - Organisations should share all relevant information, and meet requirements to publish transparency data.
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Early engagement - organisations should engage with central Cabinet Office functional teams early - as strategy is being developed and well before spend is committed. Contact details can be found under key contacts.
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Accountability - Accounting Officers remain accountable for spending in their organisation and for ensuring compliance with Cabinet Office spending control requirements.
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Organisations should be open and transparent when providing the Cabinet Office with evidence and data to support their approval request. Not disclosing the full nature or necessary details of the requirement could: result in delay as further information is requested; hinder the outcome of the request; and / or increase the number of conditions attached to the approval.
Cabinet Office teams
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SLAs - publicise and meet ‘service level agreements’ to ensure timely assurance and approval processes.
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Proportionality - ensure that Spending Controls are applied in a proportionate way and support the use of existing organisational approval processes
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Join-up - ensure that central assurance and approval processes are joined up where multiple controls are triggered.
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Urgency - at the outset of a crisis, Cabinet Office and HM Treasury should consider adjustments to control requirements, potentially including an appropriate level of flexibility on thresholds, and / or tighter timetables for approvals.
Compliance, breaches, retrospective approvals and transparency
Compliance
The Spend Controls are part of HMT’s scheme of financial delegations, so non-compliance with the letter or spirit of Spend Controls and/or failure to meet expected standards may result in additional approval requirements (for example a reduction in Spend Control thresholds), qualification of Annual Accounts, and / or sanctions. Conversely, where organisations consistently meet or exceed required standards and demonstrate strong governance and capability in an area of spending covered by a control, they may earn greater autonomy from the requirements to seek Cabinet Office’s approval (for a defined period and / or until leadership in the organisation’s functional area changes).
Pipelines are mandatory for Commercial, Grants, Property, Facilities Management and Digital and Technology spending. The effective operation of these pipelines is necessary for compliance with the Spend Controls. Other spending must follow the early engagement process set out on each control’s guidance page on Gov.uk.
Annex C ‘Expectations and Compliance’ sets out in greater detail the expectations for organisations as part of the controls framework and lists behaviours that may result in additional oversight or compliance measures.
A transaction undertaken by a government organisation that is itself exempt from the Spend Controls but done on behalf of an organisation that is in scope of those controls, may be subject to Spend Control. For example, a property transaction where an exempt organisation takes a leasehold or freehold interest in a property for the purpose of providing accommodation for an in-scope government occupier will be subject to the property control. In addition, the requirement for Cabinet Office Spend Control approval may be a condition of a relevant grant agreement or contract.
Breaches of Spend Controls
Failure to gain the necessary Cabinet Office Spend Control approval, or failure to meet the conditions set for approval, means that spending is outside an organisation’s delegated authority and therefore irregular. Similarly, any resources committed or expenditure incurred in breach of a condition attached to Cabinet Office Spend Control approval is irregular.
Spend control breaches must be brought to the attention of the Cabinet Office and your HM Treasury spending team as soon as possible. For bodies sponsored by departments, breaches should be referred to the Cabinet Office and HM Treasury via your sponsoring department. Retrospective approval of spending subject to Cabinet Office Spend Controls will only be provided in exceptional circumstances. Where retrospective approval is not given, the organisation must inform the NAO and follow the guidance set out in Managing Public Money.
Breaches of controls and failure to report such breaches may also result in sanctions or changes to delegated thresholds above which organisations are required to seek Cabinet Office approval for spending (see below).
Annex D ‘Breaches of spend controls’ sets out in greater detail actions an organisation must take if they breach Spend Controls and how the Cabinet Office can be expected to respond to a breach of the Spend Controls.
Retrospective approval
The Cabinet Office will not generally consider requests for retrospective approvals. In exceptional circumstances (for example the rare scenario where urgency prevents time-critical, unanticipated spend from being approved in the normal fashion) a request for retrospective approval may be considered. Handling should be agreed with the relevant functional and central controls teams at cabinetofficecontrols@cabinetoffice.gov.uk when the spend control breach is identified.
Transparency
Departments and organisations are responsible for publishing quarterly data summaries of spending proposals approved through Cabinet Office Spend Controls.
Approved expenditure requests should have the case name, amount of spending approved and date of approval published each quarter. For more information on this requirement please contact cabinetofficecontrols@cabinetoffice.gov.uk.
Types of spend in scope of the Spend Controls, and thresholds
The expenditure categories (‘specified activities’) that are subject to Spend Controls are as follows (all thresholds are exclusive of recoverable VAT, unless stated otherwise).
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Advertising, Marketing and Communications
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Commercial - including Consultancy and Professional Services
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Digital and Technology
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Contingent Labour
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National Property Control
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Facilities Management (FM)
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Redundancy and Compensation
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Learning and Development
Advertising, Marketing and Communications
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Summary: Organisations must seek approval from the Government Communication Service (GCS) in the Cabinet Office for advertising, marketing and communications (AMC) spend according to the threshold below. Each autumn, organisations are required to submit an overview of any campaigns and programmes of communication planned for the next financial year. Using this pipeline of future activity, GCS will determine the level of assurance required for each item. Formal control approval may be granted immediately or a further technical business case may be required.
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Threshold: Spend of £100,000 or more within a financial year is subject to the control. This threshold applies to the total spend of a campaign or programme of communications, even where an individual proposal or element is less than the approval limit.
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Timing: Technical cases should be formally submitted to GCS at least 21 calendar days before a decision is required. This 21-day turnaround should be factored into planning to meet any internal or campaign delivery deadlines and organisations are advised to engage with GCS as early as possible.
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Links: Advertising, marketing and communications spend controls and Advertising, marketing and communications spending control guidance
Commercial
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Summary: The Commercial Operating Standards require organisations to create a commercial pipeline to record future commercial spend activity above approval limits, looking ahead at least 18 months and up to 3 years. Based on an assessment of risk and complexity, assurance on selected items from the pipeline may be delegated to organisations. Where activities recorded on the pipeline are subject to formal control approval, or for items not included on a commercial pipeline, you should follow commercial controls guidance.
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Threshold: All future commercial spend activity, framework agreements or material changes to services worth £20 million or more are subject to commercial controls. Some organisations have different control limits which are communicated by settlement letters.
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Timing: Pipelines should be kept up to date and reviewed regularly. Formal spending control approval should be requested at the procurement (Outline Business Case) and contract award (Full Business Case) stages at least 28 calendar days before a decision is required.
Digital and Technology
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Summary: Organisations should record all existing and planned digital spend above the spend threshold on a digital and technology pipeline using the get approval to spend service, looking ahead at least 15 months. The pipeline should be updated regularly.
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Threshold: The control applies to any public facing services over £100,000 and all other digital and technology spend over £1 million. For any cases cases involving Crypt-Key a £0 threshold applies.
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Timing: A 28-day service level agreement applies.
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Link: Digital and technology spend control (version 6) - GOV.UK
Contingent Labour
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Summary: Organisations procuring contingent labour must seek approval internally or from the Cabinet Office via the online portal according to the thresholds below.
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Threshold: From 1st February November 2023 Contingent Labour (CL) contracts with day rates of £1000 (excluding any fees) must be approved.
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Timing: Approval should be sought from the Cabinet Office after you have received internal approval from your organisation.
National Property Control (NPC)
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Summary: Government organisations shall develop a Property Event Pipeline in line with the published standards and guidance. The pipeline should represent a forward look of all property transaction event activity in scope of the NPC. Organisations shall submit a control request for property acquisitions (freehold, leasehold or licences) and to continue tenancy (non-exercise of breaks, extension or renewal of leases).
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Threshold: Expenditure over £100,000 for the duration of the commitment (freehold acquisition cost or total rental expenditure to lease expiry)
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Timing: Pipelines should be kept up to date and reviewed regularly. Organisations are advised to engage with the NPC team at the strategy development stage (at least 6 months prior to your required approval date, depending on the type, value, scale or complexity of the property approval being sought). Formal NPC approval shall be requested at least 28 calendar days before a decision is required; organisations are advised to engage much earlier than the SLA timescale to allow for the project and approval request to progress in parallel.
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Transitional Arrangements: The requirement to develop Property Event Pipelines came into effect from 1 April 2021. In recognition that it may take time to create Pipelines, transitional arrangements apply. The NPC Team will work with organisations to understand their portfolios and agree a proportionate approach to assembling their initial Pipeline.
Facilities Management (FM)
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Summary: The overarching aim and purpose of the Facilities Management (FM) Controls is: “To improve efficiency in Facilities Management through the centralised approval of all new, extended or variations to FM contracts.” Departments must submit an FM contract pipeline for all FM contracts, expiring in the next 3 years, through their yearly departmental Strategic Asset Management Plan return.
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Threshold: FM contracts with a total value of £500k or less should be notified via the FM pipeline, these do not require formal approval. All contracts over £500,000 should seek approval via the FM Control submission form. FM contracts over £10 million will be jointly assessed by OGP and the Commercial Function (using FM and Commercial assessment criteria respectively).
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Timing: You should engage with the FM control team at the strategy development stage (approximately 6 months prior to your required approval date, subject to the complexity of the case). Formal approval should be requested at the procurement (Outline Business Case) and contract award (Full Business Case) stages. Details of contract awards should be submitted for information. A 10 working day SLA applies to cases between £500K and £10M; for cases of £10M or more a 28 day SLA applies.
Redundancy and Compensation
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Summary: The Cabinet Office must approve all redundancy and compensation schemes and certain individual exit arrangements made under the terms of the Civil Service Compensation Scheme.
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Threshold: Bulk exit schemes for more than 20 staff must be approved by Cabinet Office ministers; schemes for fewer staff are approved at official level. All individual exits with a value of more than £95K must be approved by Cabinet Office ministers.
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Timing: Service Level agreement 25 calendar days
Learning and Development
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Summary: Organisations should submit requests for generic learning and development services (new or contract extensions) outside the core curriculum, and for department-specific learning and development services above the threshold.
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Threshold: Approval is required for organisation-specific learning and development services above £10,000 (new or contract extensions).
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Timing: Applicants are not required to justify their learning request but must clearly define the learning need so the application can be directed to the appropriate supplier. Once applicants have submitted details of their requirements, they will be contacted within five working days to discuss the progression route.
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Link: Learning and development (Civil Service Learning) spend controls - GOV.UK
Additional Cabinet Office functional controls
Grants
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Summary: All relevant general grants spend activity is subject to a 3-step spend controls process for review and should be disclosed via a grants pipeline.
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The following are out of scope of the control, but must still be submitted via the grants pipeline for information: formula grants; Grant In Aid; and general grant schemes below the threshold that are not manifesto-related.
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Manifesto-related general grants schemes below the threshold are in scope of the control. The 3-step process is: triage of activity into 3 tiers £10M, £100K - £10M, £100K; scrutiny from the Complex Grants Advice Panel for eligible schemes; and approval through Functional Standard-compliant internal governance processes.
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Threshold: Level 1 General Grant Management Function support is generally applicable to schemes over £10M.
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Timing: The service level agreement is to be defined. Please contact your GGMF contact for further details.
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Link: Government Functional Standard GovS 015: Grants - GOV.UK
Counter-fraud
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Summary: Organisations should work with the Cabinet Office Counter Fraud Centre of Expertise to review commercial and grants pipeline spend activity, and assess their compliance with the government Counter Fraud Functional Standard GovS 013 and the organisation’s counter fraud strategy.
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Threshold: Organisations should always ensure significant fraud risks are addressed in line with their counter-fraud strategies. Organisations with a budget in excess of £100M should also ensure that spend proposals are compliant with the government functional standard GovS 013: counter fraud. For spending proposals over £100M, organisations must complete a high-level Fraud Risk Assessment and develop an action plan to deal with pre- and post-payment risks and submit this as part of their spend control approval request.
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Timing: See timing for relevant Spend Control(s).
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Link: Government Counter Fraud Function and Profession - GOV.UK
Joint Cabinet Office and Treasury controls
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Summary: The following pay and recruitment and retention controls operate under a separate framework to the Cabinet Office Spend Controls, but are summarised here for convenience.
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Remuneration packages for senior public officials (as defined in the guidance) at and above £150,000 pro rata per annum and performance related pay above £17,500 pro rata per annum must be approved by the Chief Secretary to the Treasury. Cases should be sent to the Cabinet Office contacts as set out in the guidance. (SLA 21 calendar days).
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SCS pay on appointment exceptions must be agreed by the Permanent Secretary and the relevant Head of Profession. For Directors General roles the agreement of the DG Pay Committee must also be sought via the Cabinet Office contacts set out in the guidance (SLA 14 calendar days).
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Delegated pay business cases over the figure in the remit guidance require Cabinet Office minister and CST approval (SLA 25 calendar days).
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Pivotal Role Allowances (PRAs) are aimed at retaining experienced members of the SCS in highly specialised roles and those delivering the riskiest major projects across government and other priorities. All PRAs need approval by the Civil Service Chief Operating Officer and the Treasury Permanent Secretary. For cases where the annual value of the PRA exceeds £15,000 approval is also needed from the the appropriate Cabinet Office Minister and the Chief Secretary to the Treasury (SLA 21 calendar days)
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Director General appointments must always be approved by the Senior Leadership Committee. Business cases must be sent to the Cabinet Office (SLC Secretariat) (SLA 14 calendar days).
HM Treasury controls
In addition to the above controls, all expenditure requests that are above departmental delegated limits - and those which are novel, contentious and/or repercussive - must be submitted to the relevant HM Treasury spending team for approval.
Key contacts
Email cabinetofficecontrols@cabinetoffice.gov.uk for general questions about the spend controls policy. For queries about specific spend controls email:
Advertising and marketing communications.controls@cabinetoffice.gov.uk
Commercial controls commercialassurance@cabinetoffice.gov.uk
Contingent labour cabinetofficecontrols@cabinetoffice.gov.uk
Digital and technology cddoassurance@digital.cabinet-office.gov.uk
Facilities management fmcontrols@cabinetoffice.gov.uk
Grants management grants-management-function@cabinetoffice.gov.uk
Learning and development contact.ccdt@cabinetoffice.gov.uk
Property nationalpropertycontrols@cabinetoffice.gov.uk
Redundancy and compensation redundancyschemes@cabinetoffice.gov.uk
Last updated 23 February 2024 + show all updates
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Updated digital and technology control to reflect the change of the policy from version 5 to version 6
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retire version 4 of digital and technology guidance - non-pipeline process
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Updated CDDO email. Fixed minor typos
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Updated to Version 7, removed Version 6 document
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First published.