Chancellor Defends Move to Reduce Administrative Spending as Concerns Grow Over Potential Job Losses
Chancellor Rachel Reeves is under mounting pressure from unions over plans to cut Civil Service operational costs by 15%, a move that could lead to significant job losses in the public sector. While Reeves has expressed confidence that a reduction of 10,000 positions is achievable, union leaders warn that the real figure could reach as high as 50,000.
Reeves defended the proposal, stating that the Civil Service had expanded significantly during the COVID-19 pandemic and that reductions were necessary to streamline government operations. She emphasised that the cuts would primarily target administrative and bureaucratic functions rather than frontline services.
Between 2010 and 2016, the size of the Civil Service was reduced by 19% to around 384,230 employees. However, staffing levels surged following the Brexit referendum as policy specialists were hired to manage the UK’s exit from the EU. By September 2024, the Civil Service workforce had reached 515,085 – an 18,970 increase from the previous year. Despite a slight decline of 0.1% in December, staffing levels remained at 514,395.
Transport Secretary Heidi Alexander insisted that the government was not setting a rigid target for job cuts but stressed the need for a “leaner” and “more agile” Civil Service. “We’re not dictating a number, but we do believe the public sector must adapt to modern challenges, including the use of technology and AI,” she said.
Unions have fiercely opposed the proposed reductions, arguing that they would negatively impact essential public services. Public and Commercial Services union general secretary Fran Heathcote warned that the cuts would not only affect workers but also harm the quality of services relied upon by the public.
FDA general secretary Dave Penman estimated that the proposed savings would equate to approximately 10% of the Civil Service salary bill over the next three to four years, potentially leading to the loss of up to 50,000 jobs.
The planned reductions come amid broader concerns over government spending, including recent backlash within Labour ranks over welfare cuts and reduced aid budgets. Reeves, however, has denied that the measures amount to austerity, highlighting increased investments in infrastructure and healthcare.
“We are committed to ensuring efficient government spending,” Reeves said, noting that the Civil Service remained significantly larger than before the pandemic. “This is about making necessary efficiency savings so we can prioritise funding where it is needed most.”
The government aims to save £2.2 billion annually by 2029-30 by cutting Civil Service administrative budgets by 15%. Reeves assured that these savings would not affect critical services but unions argue that distinguishing between “back office” and “frontline” roles is not straightforward.
Looking ahead to the spring statement, Reeves reaffirmed that fiscal responsibility remained a priority. While she acknowledged changing economic conditions, she insisted that government spending would continue to be guided by strict fiscal rules.
