Plans to slash government administrative costs will see the civil service headcount drop by around 10,000, the chancellor has said.
Rachel Reeves confirmed this weekend that she is asking departments to cut running costs by 15% by the end of this decade.
Pressed on what this would mean for civil service jobs, the chancellor told Sky News she was “confident that we can reduce civil service numbers by 10,000”.
Reeves added: “During Covid, there were big increases in the number of people who were working in the civil service. That was the right thing to do to respond to those challenges. But it's not right that we just keep those numbers there forever. Because they haven’t been cut back since Covid, despite the fact that the world has changed since then.”
There are now around current headcount 513,000 civil servants, 90,000 more than at the beginning of the Covid-19 pandemic. The increase came on top of considerable growth as the government took on more responsibilities as a result of Brexit.
Ministers are set to direct departments this week to find savings of 10% by 2028-29, saving around £1.5bn a year, and 15% by 2029-30, resulting in annual savings of £2.2bn. In July, departments were set a target of making 2% admin savings in 2024-25.
Reeves, who is expected to unveil a swathe of spending cuts at the Spring Statement on Wednesday amid faltering growth, said the 15% savings target includes consultancy spend, travel budgets and communications budgets, and “doesn’t have to be all about people”.
She told BBC News "anyone running a business will think that" the 15% savings target "is more than possible" because of advances in technology and AI. She said artificial intelligence is already being used in HM Revenue and Customs and the Department for Work and Pensions to tackle fraud and error, "using technology alongside people, but using more technology to do some of those jobs".
Reeves said the cuts would not be pain free but would result in "better public services", with savings invested in "people working on the frontline, whether its teachers in our schools, police on our streets, or doctors and nurses in our hospitals”.
Ministers 'must be honest' about impact on public services
FDA general secretary Dave Penman said ministers need to be “honest with the public and their civil servants about the impact this will have on public services”.
Penman said: "Elected governments are free to decide the size of the civil service they want, but cuts of this scale and speed will inevitably have an impact on what the civil service will be able to deliver for ministers and the country.
"The budgets being cut will, for many departments, involve the majority of their staff and the £1.5bn savings mentioned equates to nearly 10% of the salary bill for the entire civil service."
"The idea that cuts of this scale can be delivered by cutting HR and comms teams is for the birds," he added.
He also warned that the plans could threaten up to 50,000 civil service jobs.
Ministers have previously said that the government will not set an arbitrary headcount reduction target. Technology secretary Peter Kyle said this month that it is “almost certain that the headcount will go down” but that “it's not going to be an arbitrary overall figure”.
Mike Clancy, general secretary of the Prospect union, said ministers must deliver on their commitment not to implement arbitrary headcount cuts, and that the plans should include "a proper assessment of what the civil service will and won’t do in future”.
“Reforming the civil service to make it function better is a goal that staff support, but government must remember that a cheaper civil service is not the same as a better civil service,” he added.
“It is also not the case that there is a clear divide between ‘back office’ and ‘frontline’ public servants. Civil servants in all types of roles help the public and deliver the government’s missions. Cutting them will inevitably have an impact that will be noticed by the public.”
PCS general secretary Fran Heathcote warned that “any cuts will have an impact on frontline services”.
“We’ve heard this before under Gordon Brown when cuts were made to backroom staff and the consequence of that was chaos. If the last government taught us anything it’s that you can’t cut your way to growth," she said.
Heathcote added: “We’re happy to engage with the government over many issues but if they don’t talk to us about what is an arbitrary figure for cuts plucked out of the air in order to make it sound like an efficiency they will meet with a lot of opposition, not just from unions but from the public who will be affected by cuts in the services they receive.”