HMRC is one prime example, MPs on the Public Accounts Committee (PAC) warned, with six of its 12 new hubs locked into 25-year ‘unbreakable leases’ at higher than current market rents.

The MPs were also sceptical about whether the government hubs programme, which relocates civil servants from small offices into large offices across the UK, was good value for money. This is the cornerstone of HMRC’s property portfolio with the majority of new tax offices accommodating up to 4,000 staff, co-located with other government departments.

HMRC is now trying to sub-let spaces at a rent which is higher than the market, the report said, adding that it warned HMRC about this practice.

With limited data available on future office usage due to home working and the risk of empty office space, it remains unclear how many hubs are on long-term fixed leases. The MPs warned that this could create the risk of the government facing unnecessary costs.

MPs have called on the Cabinet Office to set out in detail the benefits and costs on an annual basis, in response to its plans to operate 31 new office spaces across the UK.

The report also criticised the government’s delayed response in developing an update database of its properties, which costs the taxpayer £22bn a year to maintain.

According to the Public Accounts Committee (PAC), the Cabinet Office continues to rely on outdated IT systems and had missed a 2021 deadline to launch a new £1m computer system.

In 2020, the Cabinet Office expanded its data collection, shifting from only gathering data through offices and warehouses, to all government property.

However, PAC warned that the plans for managing the government’s extensive estate portfolio, which is valued at approximately £158bn and costs £22bn a year to maintain, remained out of sync with current market conditions.

MPs said the government property agency remained ‘handicapped’ in achieving the planned reforms due to ageing IT systems and incomplete data on post-pandemic office usage, with the risk that taxpayers would be locked into long-term, high-cost leases.

It stressed that the government’s reliance on the 17-year-old ePIMS system, which was meant to be replaced by inSite in 2021, was unable to accommodate any additional data. 

It has called on the government to get the inSite system up and running as soon as possible, to avoid hindering the effective management of £158bn worth of property.

Sir Geoffrey Clifton-Brown, deputy chair of PAC, said: ‘The plague of ageing, inadequate data systems strikes again, this time at the heart of government’s £158bn property estate.

‘The whole plan for a network of government office hubs across the UK appears to be in some disarray, with radical shifts in office space use and rental values, but the Cabinet Office simply hasn’t got enough grip on the facts on the ground to adapt.’

The committee has also called on the Cabinet Office to ensure that departments with the largest land holdings fully participate in the government’s disposal programme, which pledged to sell off £1.5bn worth of government buildings, particularly expensive locations in London.

In August, the plans were announced with the aim of raising £2bn from property sales. But MPs have stressed that it remains ‘unclear’ how the government will meet its target, as the department has failed to publish detailed plans.