(21) A 10% reduction in the size of the civil service

This suggestion comes from the TaxPayers' Alliance/ Institute of Directors report on saving £50 billion.  For a PDF of the full report (including footnotes for claims made below) click here.

"Civil service numbers during the first quarter of 2009 averaged 526,000. If we assume the staff from the quangos (see later in this section for our suggestions) have already been removed (to avoid any potential double counting of savings), then the total civil service workforce stands at around 515,000.  Assuming the annual gross pay of these civil service staff corresponds to the public sector mean of £23,943, the total annual wage cost is £12.3 billion.  A targeted ten per cent cut among this specific group of personnel by 2010-11 would deliver a saving of £1,233 million to the Exchequer. 

This estimated saving will almost certainly be a low estimate, as the saving does not include office and other employment costs nor any future gains accrued from reduced pension liabilities.  There may be an increase in unemployment benefits following this cut, although it would be possible to make a 10 per cent reduction in costs through reduced hours rather than lowering the headcount. 

Rationale

In recent years civil service numbers have dropped considerably.  From a peak of 569,000 in 2005, they fell to 523,000 by the end of 2008.  However this decrease follows an extraordinary rise between 1999 and 2005, when over 66,000 people joined the ranks of the civil service.  Moreover, in recent quarters the numbers have started to creep up once again.

The costs associated with these additional employees are significant, yet there is little if any evidence of an improved service.  Departing Government ministers have gone as far as to suggest the delivery of programmes and policy would be better served by a civil service half the size of the one currently in place.

We would not go this far, but just as we have suggested a targeted cut in ‘backroom’ staff in two key public services, a similar programme should be implemented in the core civil service.  Some particular areas should (and will be able to) accommodate staff reductions greater than 10 per cent, alleviating the pressure on harder pressed or better performing areas.  For example, while some of Defence Equipment and Support’s 25,000 staff have overseen a lamentable deterioration in defence procurement and provision, the work of Job Centres is increasingly important.  Headcount reductions should be applied across the Government surgically, not indiscriminately."

Savings id: A 10% reduction in the size of the civil service.
Department: Across Whitehall
Annual saving: £1,233m

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Previous idea for saving: (20) Halt further orders and upgrades for the Eurofighter.