Major civil service job cuts on the table amid 'budget pressures', Dowden confirms

Minister says the "only difference" to scrapped 91,000 cuts plan "is we will be driven by outcomes”
Alex Chisholm (left) and Oliver Dowden (right). Photo: Parliamentlive.tv

By Tevye Markson

27 Jan 2023

The government is still planning significant reductions to the civil service but headcount reductions will aim to achieve “outcomes” rather than meet arbitrary targets, the Cabinet Office’s senior minister has said.

Rishi Sunak scrapped previous prime minister Boris Johnson’s plans to cut 91,000 jobs shortly after he was appointed PM last year, instead asking every department to "look for the most effective ways to secure value and maximise efficiency within budgets”.

Asked by PACAC chair William Wragg if the government was still committed to reducing the size of the civil service and if this would now be a target for reduction in cost rather than size, Oliver Dowden said: "'Yes' is the short answer". 

Dowden , who was part of Johnson’s cabinet when the ex-PM announced plans to bring the civil service headcount back to 2016 levels, said he thinks "the only difference" to Johnson's plan will be that “we will be driven by outcomes”, suggesting significant job cuts could still be on the way.

"I was in the cabinet of the former prime minister Boris Johnson when we discussed the expansion of the civil service as a result of both Covid and Brexit preparedness," he added.

He said he and Johnson were "seized of the need" to bring the civil service headcount down to around where it stood after ministers started reducing it in 2010. Between then and 2016, the government drove down civil service numbers from around 481,000 to a post-World War II low of 384,000 under then-Cabinet Office minister Francis Maude's civil service reforms aimed at improving efficiency.

Numbers have since risen to around 479,000 as of July 2022.

"I think the only difference is that we will be driven by outcomes. And those budget pressures are going to force better ways of working and certainly reduction in headcount as well," Dowden added.

'Considerable effciency savings' needed in most departments

Departments are currently working on proposals, as part of this government's efficiency and savings review announced at the 2022 Autumn Statement, to reduce costs as soaring inflation this year has eaten into budgets.

Dowden confirmed to MPs yesterday that all departments will send this information by the end of the month, with the government aiming to report on the review's progress in spring 2023.

He said squeezed department budgets would mean most departments will need to find savings, including headcount reductions.

“If you look at the spending review settlements over the coming years, those are tight spending review settlements, which for most departments outside a small number of protected departments will see quite substantial reductions in their budgets,” he said. “That will necessarily drive considerable efficiency savings, and I would expect to drive headcount savings as well.”

Dowden said the savings would also be necessary to “maintain frontline services”.

Sunak has previously committed to focusing cuts on non-frontline roles but Dowden said the government will look to achieve this by “having better ways of working” rather than “an arbitrary target” of frontline job cuts.

He pointed to reforms driven by former Cabinet Office minister Francis Maude which saw the Cabinet Office HR and property functions that were in individual departments merged as sole functions at the Cabinet Office.

“That’s the way in which you protect output but can achieve headcount reduction,” Dowden said.

Chisholm: 'We need more project delivery, commercial and digital roles'

Alex Chisholm, the civil service’s chief operating officer, was asked what measures are being put in place to ensure that, as the civil service shrinks, its capability is maintained.

He told MPs the government would try to protect project delivery, commercial and digital roles.

Chisholm said, despite a “huge increase” in the number of qualified professionals working in these kinds of roles in the civil service in the last decade, more are still needed.

“When we've been doing benchmarking exercises with the highest performing organisations in the wider economy we find that actually roles like project delivery, commercial and digital we need more of rather than fewer.

“So I think it's very important as we go through the efficiency and savings review that was announced in the autumn statement, that we are careful to make sure that we don't over-squeeze in those areas which are so important to future efficiency and performance.”

Chisholm also confirmed that outcome delivery plans, which were cancelled this year due to disruption from the job cuts plan, two changes of prime minister and the Autumn Statement, would be readied by departments in time for the start of 2023-24. 

MPs also asked if ministers would lead by example in making job cuts by reducing the sizes of private offices and the number of special advisers.

Dowden replied: “Nothing is off the table. We couldn't expect ministers to be exempt. That has already been the case across ministerial offices”.

There are currently more spads than at any time in the past 12 years, according to Institute for Government figures from July 2022.

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