The plan to axe 91,000 civil service jobs within the next three years looks like the sort of back-of-the-envelope policy which appeals to headline-grabbing politicians. Is there any substance to it at all?
The pace at which the civil service has grown in the last few years is a problem. Sure, some of it is down to the peculiar demands of Brexit and the Covid-19 pandemic, and it is reasonable to expect that these demands are sharply diminishing and should diminish further. Much of the expansion, however, arises from the ever-growing range of government functions. The fastest growth has been among senior civil servants (driven in part by the usual departmental reorganisations that no government seems able to resist) and policy advisers whose job, in a nutshell, is to think of new ways for governments to be involved in our lives. We have gone way past the stage where extra government involvement and spending brings diminishing returns.
It may be feasible to get the civil service headcount back to its 2016 level, or even lower, but it has to be done carefully and accompanied by an analysis of what the government really needs civil servants to do – including whether even those essential functions can be better handled by privatisation. Do we really need drivers’ licences to be produced by civil servants? There are privacy and data protection issues of course, but much confidential government work is already outsourced and handled outside the civil service.
The danger with the proposal at hand is that departments and ministries will just be given a target percentage reduction that is the same across the board. Thus the biggest departments will take the biggest hits. At present 60 per cent of all civil servants work in just four departments: Work and Pensions, Justice, HMRC and Defence. While some of these departments could probably manage with smaller numbers, however, most Ministry of Justice “civil servants” are prison and probation officers, few of whom are the home-working pen pushers of popular imagination. Do they really merit a blanket cull?
The savings from the proposed cull are estimated at about £3.5 billion. This depends on some assumptions about how rapidly it could be done, what proportion can be achieved by voluntary redundancy and how the unions would behave. It would be a while before real savings could be achieved, so it’s misleading to think that these could be turned quickly towards as yet unspecified measures to reduce the cost of living for vulnerable people. If such measures are taken they’ll have to be funded initially by borrowing.
Furthermore, £3.5bn is a drop in the ocean. Government spending last year was more than £1 trillion. And perhaps the planned 91,000 jobs to be chopped should be seen against the 5.7 million currently employed in the public sector as a whole (and millions more in jobs substantially funded by the government, such as large parts of the railways and the numerous quangos that David Cameron once wanted to make a bonfire out of).
Cutting back the numbers of civil servants is an essential feature of reducing the role of the state and moving us to a lower-tax economy. But it is only a gesture. The government needs to think much more carefully about removing large amounts of state spending and involvement in the economy. The cabinet has not grasped this yet. It probably never will.