Headlines: March 18th, 2004

Chancellor Gordon Brown, in his Budget Statement, revealed how the Prime Minister’s vision of a transformed Civil Service outlined in a speech last month is to be put into effect. All central departments are to cut their budgets by 5% by 2008 and this will result in running costs being reduced to 3.7% compared to the 1990s average of 5.7%. Staff cuts of 43,300 posts have already been identified.In securing these efficiency gains there will be a strong emphasis on using normal staff turnover and the Government is examining options for strengthening the current arrangements for civil service staff to be redeployed across administrative boundaries.

Staff savings will be achieved by streamlining back office functions such as IT, finance, human resources and management services. Better channels of communication will also make it possible to cut posts involved in providing transactional services. The Department of Work and Pensions already pay 60% of benefits into the bank accounts of customers and this development underpins plans to cut 40,000 posts. It is planned that 10,000 of these posts will be re-deployed to provide better front line service.

A new tax department will be formed from a merged Inland Revenue and Customs and Excise. This will allow 3,500 staff to be re-deployed to front line work and a further 10,500 post to be cut. The new department will be structured with a customer focus to provide business with a one stop service.

Overall staffing expenditure will also be cut by re-locating 20,000 staff out of London and the South East following the Chancellor’s acceptance of the recommendations in the Lyons review.

John Oughton, the new Chief Executive of the Office for Government Commerce, has been appointed as the supremo to drive the efficiency programme.

Jonathan Baume, general secretary of the top civil servants union said: “The government is proposing a radical restructuring of the civil service. The Chancellor’s announcements today of major job cuts in many departments go considerably further than the plans we were already aware of. No one should underestimate the implications of these cuts for individual civil servants at all grades and their families. We see no justification whatsoever for any compulsory redundancies.”

Mark Serwotka general secretary of the Public and Commercial Services said: “For thousands of hard working staff to hear that they are losing their jobs totally out of the blue without consultation is unacceptable. We are not against a more efficient civil service with more resources going to the frontline, but it is difficult to see how services will improve with such swinging cuts.”