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Civil Service faces skills shortage due to reduction in recruitment

The Civil Service faces a major skills and talent shortage in the future as it focuses on minimising staffing levels through reducing recruitment, the National Audit Office has warned.

In a new report the NAO said that central government must also do more to help departments plan for reductions in the workforce.

The report found that government departments have made significant reductions in their staff numbers and salary bill since 2010. This has been achieved mainly by minimising recruitment, a cheaper option in the short term than paying staff to leave, but resulting in older staff comprising a greater proportion of the workforce.

It points out that this changing of the age profile in the civil service might increase the risk of a shortage of talent and skills in future.

The number of civil servants fell by 18%, from 492,000 in March 2010 to 405,000 in December 2014. The civil service annualised salary bill stood at £11.13bn in March 2014, 18% (£2.49bn) lower in real terms than four years earlier.

Due to the restriction of recruitment, the report says that the percentage of the Civil Service workforce aged 20-29 reduced from 14% to 9% from 2010 to 2014 while the percentage of 50-59 year-olds increased from 26% to 31%. The proportion of staff in the most junior grades reduced over the same period from 46% to 40%.

The auditors believe there is a growing awareness in government of the risk these low levels of recruitment may bring, such as not having the talent and skills needed for future challenges, but say there is not yet a clear understanding of the potential consequences or the necessary management actions.

The report suggests departments may need to manage any future staff reductions strategically, to reduce the risk of damaging public service delivery. However, some departments have made less progress than others in setting out their long-term operating models - the Public Accounts Committee reported in 2012 that departments did not have long-term plans to work with fewer staff.

The NAO examined four departments as case studies (HMRC, MoD, DfT and DfID), and found that in general they had not yet fully implemented strategic workforce plans across their groups.  They also lacked comprehensive information on workforce skills and some had not completed detailed plans for the period after 2015, increasing the risk of not being well-informed when they go into the next spending review.

Amyas Morse, head of the NAO, said: “Departments have significantly cut their staff numbers and costs in the last five years but not enough planning has gone into making sure that, over the longer term, the reductions already made and any required in future are sustainable and do not damage the delivery of public services. The centre of government must do more to help departments meet these challenges, including managing the heightened risk of a shortage of vital skills.”

A Cabinet Office spokesperson said the department would review the NAO recommendations.

“The Civil Service is the smallest it’s been since the Second World War, saving taxpayers £2.4bn last year, while continuing to deliver leading public services

“We are working to ensure that the civil service is more skilled and diverse, and have made strong progress in building strong commercial, digital and project delivery skills. We will continue to focus on these areas.”

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