UK freezes government credit cards to cut public spending
Thousands of government credit cards will be suspended this week as the U.K. government moves to crack down on what it calls “wasteful” spending, a decision that will force civil servants to reapply under stricter scrutiny or lose access altogether.
The move, led by the Cabinet Office and Chancellor of the Duchy of Lancaster Pat McFadden, is part of a broader effort to curb expenditures and refocus resources on public services.
The initiative will freeze nearly all of the 20,000 Government Procurement Cards (GPCs) currently in circulation, with an expectation that at least half will be permanently canceled by month’s end.
Only a select few, such as those used by diplomatic staff in volatile regions, will be exempt from the freeze. Departments have been directed to authorize only the minimum number of new cards necessary, tightening oversight on government expenses that have quadrupled in four years, reaching over £600 million in the last financial year.
“We must ensure taxpayers’ money is spent on improving the lives of working people,” McFadden said. “It’s not right that hundreds of millions of pounds are spent on government credit cards each year, without high levels of scrutiny or challenge. Only officials for whom it is absolutely essential should have a card.”
The measures follow recent revelations of spending that critics argue exemplifies government waste. Examples include nearly £2,500 at a shoe shop in Barbados by Foreign Office officials, a £1,200 splurge on luxury coffee pods over two months, and a reported £1,800 on a “value for money” training course.
The Labour Party, which while in opposition criticized the Conservative government for extravagant purchases on government cards, has now faced accusations of similar indulgences under its watch.
Reports last month detailed procurement card expenditures on private members’ clubs and luxury glassware, prompting opposition claims of hypocrisy.
Alongside the card suspensions, the government is slashing the maximum spend for hospitality expenses from £2,500 to £500, with any expenditure above that threshold requiring Director General approval.
Civil servants will also be prohibited from using the cards for expenses that could be handled through established procurement channels, such as travel bookings and office supplies, which are often more cost-effective when bought in bulk.
The clampdown is part of a wider strategy by Prime Minister Keir Starmer to reshape Whitehall operations and eliminate inefficiencies.
That agenda has already resulted in the abolition of certain government bodies, such as the Payment Systems Regulator and NHS England, at the cost of approximately 10,000 jobs.
Departments are also under orders to identify any unauthorized or inappropriate card transactions, with McFadden warning that disciplinary actions will be taken where necessary.
The financial tightening comes as Chancellor Rachel Reeves prepares to deliver her Spring Statement, which is expected to include significant spending reductions. The government’s push to rein in costs aligns with Starmer’s pledge last week to make the state “leaner and more efficient,” reducing bureaucratic hurdles while maintaining core public services.
However, some analysts warn that excessive cost-cutting could hinder the government’s ability to deliver on key priorities, such as addressing the NHS backlog and bolstering law enforcement.
For now, the focus remains on tightening financial oversight. As civil servants rush to justify their continued access to procurement cards, government officials insist the effort is about safeguarding taxpayer funds.