Latest Public Sector News

30.11.15

Over 100,000 public sector jobs to go in this Parliament

More than 100,000 public sector jobs are expected to be lost over the course of this Parliament, according to the Office for Budget Responsibility (OBR). 

Its ‘Economic and fiscal outlook’ notes that slow growth in cash spending and low annual wage growth suggest that “general government employment will fall by 0.1 million between the first quarter of 2015 and the first quarter of 2020, leading to a total fall from early 2011 of 0.4 million”. 

The OBR added that this is 300,000 less than projected in July, following increases to spending plans and the government’s decision to limit public sector pay awards to 1% a year over the period. 

However, the OBR did not give a detailed breakdown of the likely distribution of the cuts between the Civil Service and the wider public sector. 

Following last week’s Spending Review, the government said it is going to consult on further “cross-public sector” action on payment terms, to reduce the costs of redundancy payouts and ensure greater consistency between workforces. 

It will also carry out a review of “sickness absence” in public sector workforces before consulting on how to reduce its impact on public service delivery, and “considering legislation where necessary”. 

Last week, the Institute for Fiscal Studies (IFS) stated that July's fiscal arithmetic implied average cuts of 27% to the resource spending of 'unprotected' departmental spending – that is to day-to-day spending other than that on health, schools, ODA and defence which was explicitly protected. The comparable figure after the Spending Review announcements is 'just' 18%, one third less than implied in July. Yet the planned surplus for 2019-20 is largely unchanged. 

Paul Johnson, director of IFS, said: “The first thing to say is that this is not the end of ‘austerity’. This spending review is still one of the tightest in post-war history. Total managed expenditure is due to fall from 40.9% of national income in 2014-15 to 36.5% in 2019-20. 

“A swathe of departments will see real-terms cuts. The 3% cumulative increase in health spending over the next five years is not far off the average annual increase in spending in the last 50 years.”

 

FDA general secretary Dave Penman added that whilst the budget cuts have been extensively trailed over the last few months, the sheer scale of reductions in public spending is “no less eye-watering”. 

“Despite months – if not years – of preparation, the government has once again failed to demonstrate, to both public servants and to taxpayers, how it will cut resources so dramatically while ensuring public services are maintained,” he said. 

In an interview with PSE, Mark Lloyd, the new chief executive of the Local Government Association (LGA), warned that following the Spending Review councils would see a further reduction in workforce capacity.

Comments

Biggles   01/12/2015 at 00:08

Labour increased the public sector headcount over their government period by about 1,000,000, the current government since 2010 has cut it by some 600,000 and the public has barely noticed. Do you really think that a further cut of 100,000 is going to make much difference? Not even to those who lose their jobs who seem readily employable elsewhere.

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