Treasury eyes savings from cull of duplicated civil service roles

DHSC and NHS cross-over is a particular area of focus for Spending Review, according to report
Steven Barclay Credit: Parliament

By Jim Dunton

14 Sep 2021

HM Treasury is closely probing the potential to make savings from reducing the number of duplicated roles across departments and agencies at next month’s Spending Review – and is putting particular focus on health, according to a report.

Chief secretary to the Treasury Steve Barclay, who is overseeing work on next month’s three-year settlement for departments, is particularly interested in the “overlap” between the Department of Health and Social Care and sections of the National Health Service,  the Daily Telegraph said.

Last week, prime minister Boris Johnson unveiled controversial plans for a new health and social care levy, based on National Insurance contributions, that will raise £12bn a year to help the NHS recover from the impact of the coronavirus pandemic and contribute to social care reform.

Johnson insisted in parliament that the funds raised – which will be heavily weighted towards the NHS rather than social care in the first three years – would not go on “pay awards for middle management”.

The Telegraph said that last week the NHS had put out job adverts for 42 new executives on salaries of up to £270,000 and there were fears that the NHS could “swallow” the entire £36bn in revenue from the new levy over the three year period.

The paper said that while all government departments had been asked for a full list of their workforces and those of associated bodies, the intersection between DHSC, its technology-focused joint body NHS-X and NHS Digital was an example of potential role-duplication being investigated.

It quoted an unnamed government source saying the hope was to “shine a light on the 5,500 people working in NHS England and the extent of duplication in NHS-X and NHS-D and other arm's length bodies”.

The Telegraph said officials at the organisations had been asked for a breakdown of roles below deputy-director level so that Treasury staffers could evaluate each team, how much it cost and their roles.

It added that the scale of NHS spending – both in relation to the coronavirus pandemic and the new health and social care levy – had made the health service a priority area for Barclay and his Spending Review team.

Levy ‘will fuel reform drive’

Despite the suggested focus on DHSC and the NHS,  the Telegraph cautioned that departmental reforms were likely to form part of chancellor Rishi Sunak’s Spending Review, which is due on 27 October.

It quoted a government source saying that the tax rise, which created dismay among many Conservatives – not least because it broke a 2019 general election manifesto pledge, had left ministers with a new zeal for change in departments.

“The Treasury last week had to do something extremely difficult; we now feel particularly empowered to ask them that they deliver reforms to make sure the funding is value for money,” the source said.

It was suggested last month that Barclay had warned departments to prepare to reverse increases in headcount that have taken place since 2016 over the course of the Spending Review period. Such a reduction would equate to tens of thousands of jobs.

Confirming the date of this year’s Spending Review last week, Sunak also sent a strong message to civil servants that the need for pay restraint had not subsided following the current pay freeze for all but the lowest earners.

In a letter to secretaries of state, the chancellor wrote: “Those working in the public sector have, on average, better remuneration packages than those in the private sector, with Covid also demonstrating the significant value of job security.

“For reasons of fairness and sustainability of the public finances, we must continue to ensure that public sector pay growth at SR21 (including all elements of earnings growth and pay drift) retains broad parity with the private sector and is affordable.”

Sunak will also deliver an Autumn Budget alongside the Spending Review.

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