Government plans to lay off up to 91,000 civil servants over three years will require deep cuts to public services and cost at least £1billion in severance pay, a Whitehall study has found.
Boris Johnson unveiled plans in May for an almost 20% cut in the workforce and said in June he could ‘reduce’ the civil service to 2016 levels ‘without hurting’ frontline services.
However, government insiders said a review by Steve Barclay, his former chief of staff, found otherwise.
They added that Barclay’s review had led the Treasury to “cool off” on Johnson’s plans after the full upfront cost and impact on utilities emerged.
But Foreign Secretary Liz Truss, the favorite to replace Johnson in September as Conservative leader and prime minister, backs proposals to cut civil service costs. She has vowed to wage “a war on the trash of Whitehall”.
A Whitehall insider who worked on plans to cut 91,000 civil servants said it had become clear Johnson had made his announcement – which was enthusiastically received by the Conservative Party right – without fully considering the implications.
“You can only provide 91,000 discounts by actual discounts to major frontline services,” the insider added. “There is no way to reach this number through efficiency savings or staff reductions at headquarters.”
A government insider said proposals to cut 91,000 civil servants would involve “serious cuts” to staff at HM Revenue and Customs, Border Force and prisons. “And you couldn’t protect jobs outside of London,” the insider added.
Although estimates have not been finalised, another Whitehall insider said a figure of £2billion had been discussed as a working assumption on the cost of mandatory severance pay.
Truss’ campaign team endorsed the government’s plan to cut 91,000 civil servants last week – after being forced to do an about-face on proposals to introduce regional pay scales in the public sector to save around £8, £8 billion a year.
Brandon Lewis, the former Northern Ireland secretary who is backing Truss to be the next Tory leader, told the BBC the scrapped policy on regional pay commissions was part of a ‘wider package around management waste in Whitehall”.
Citing Johnson’s target to cut 91,000 civil servants, which would bring the civil service back to historic lows in 2016 which followed six years of cuts under then Prime Minister David Cameron, Lewis said: “We must back to those levels. “The proposed cuts aim to save £3.5billion a year.
The government currently employs 475,000 civil servants, down from a low of 384,000 in 2016. The biggest growth in civil servants has been in the Department of Justice, Home Office and Department for Work and Pensions.
Demands on Whitehall have increased in recent years, partly due to the coronavirus pandemic but also due to government policies such as the recruitment of 20,000 police officers.
The UK’s departure from the EU has necessitated the expansion of the Department for International Trade to broker trade deals, while Britain’s post-Brexit immigration regime has increased immigration and personnel requirements for border forces.
The Cabinet Office said: ‘As people across the country face huge costs of living, the public rightly expects their government to lead by example and be run as efficiently as possible.
He added that it was too early to speculate on how the workforce reductions would be carried out, but that a range of options included not filling vacancies when civil servants move to the private sector or take their retirement. Consultations with unions are continuing, the Cabinet Office said.