The 'bonfire of the quangos' will cost almost double government estimates, according to spending watchdog the National Audit Office (NAO).
Instead of the £425m projected, the NAO predicted the costs of scrapping quangos would be at least £830m.
Amyas Morse, NAO head, said the government were "not doing enough to secure value for money".
"I would expect departments to have a better grasp of the costs of reorganising bodies and of carrying on functions that have been transferred."
But a Cabinet Office spokesperson said the changes would improve transparency and save over £2.6bn.
"Their figures suggest that the administrative cost of public bodies will be between £800 million and £900 million lower per year by 2014/15 after taking account the cost of these reforms...
“As we have always acknowledged, there will be one off costs of the transition, which will be around £600-£900 million. Our savings are net of these costs and will continue into the future as a lasting legacy to the taxpayer.”
The government announced their intention to axe 262 quangos in October 2010. At the time, Labour warned the project could cost more than it saved - and the NAO have said the coalition will have to find £3.5bn extra in savings to meet their targets. (http://www.bbc.co.uk/news/uk-politics-11538534)
In January 2011 the public administration select committee accused the government of botching their plans.
"I suspect that in the short term the reorganisation will now cost more than it will save. This was put together on the hoof and can be much improved for future reviews," committee head Bernard Jenkin said last year.