The Government is ‘lagging behind' on work redesigning public services so they could operate for less money on a permanent basis,  spending watchdogs have warned.

A National Audit Office report on financial management in government recommends that the Treasury provides greater leadership to civil service finance professionals - to help them tackle a fiscal consolidation programme which some experts believe will linger on until the middle of the next decade.

Issued today, the paper acknowledges finance managers, who are critical to delivering value for money, are better represented and have a greater presence in the upper echelons of Whitehall.

However, further improvements are needed in the face of the twin challenges of public service reform and real term cuts in Whitehall budgets of £45bn between this financial year and 2017/18.

The auditors were critical of government for failing to ensure top level decision-making routinely makes use of reliable information, and for officials for neglecting to match financial management to strategic and operational planning - which would link available resources to desired outcomes.

In addition, the NAO advises continued pay freezes and a ban on hiring temporary staff are not sustainable.

Amyas Morse, head of the NAO said: ‘Savings are being made but progress in restructuring how services are being delivered is lagging.

‘If the challenge of reforming the delivery of public services is to be met, then the Treasury and Finance Leadership group need to provide more effective impetus to strengthen financial management capability across government.'