The government has dealt a blow to the commercial property market by announcing a year-long freeze on the signing of any leases for commercial office space by public bodies.
The coalition government has placed an immediate ban on any central government department or quango signing a new lease with a
property investment firm.
This move forms part of the programme of savings that the chancellor George Osborne feels will achieve a fall of £6.2 billion a year in government spending.
In addition, the government wants public bodies to vacate the
commercial development buildings they are currently in, with expiring leases not being renewed, reports PublicPropertyUK.com.
This freeze will last until April 2011, during which time the government hopes it will have saved £47 million in rent.
Head of the government's Efficiency and Reform Group Francis Maude told the website: "We have got to get an immediate grip on Whitehall waste if we're going to tackle this unprecedented £156bn deficit quickly, while protecting the quality of important front line services and getting the economy growing."
The Chartered Institute of Personnel and Development says the move is a sensible one, as spending on public occupation of commercial property, along with consultancy and advertising fees, has long been "ripe" for cuts.
Posted by Hadji Singh.
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