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The original version of this article appeared on the Guardian website on Monday 20th February 2012.
It makes no financial sense to pay civil servants to leave, while paying others to join the service. Lasting damage will be done.
The government is in danger of losing control over its staffing, according to new figures, and is wasting huge amounts of money by simultaneously spending tens of millions of pounds on redundancies and millions on recruiting new staff. It has also become clear that many departments are wasting money by using backdoor channels to secure additional staff by using multimillion-pound recruitment agencies.
In its casual approach to managing public sector reforms, there is a danger that the Tory-led government will inflict lasting damage on the services upon which we all depend. Guided by the crude dogma that cheapest is best, the truth is the government is actually costing the taxpayer more. For example, its over-hasty approach to spending cuts has resulted in a headlong rush to cut the numbers of civil servants, regardless of whether or not their posts will have to be subsequently refilled. Despite these cuts, agency workers are being recruited across Whitehall. It seems that the government is set on a course of casualisation of the civil service and public sector in a short-sighted and damaging dash to cheapen the service with little regard to effectiveness or quality.
Of course, if back-office staffing posts can be reduced in the name of genuine efficiency improvements, then they should be. Indeed, when in government, Labour’s crackdown on waste freed up £21.5bn to improve frontline services. However, the government’s approach to manpower planning is chaotic and unstructured.
Following a series of parliamentary questions, it has become clear that taxpayers paid nearly £90m in redundancy pay to civil servants alone in the last quarter. If this scale of payments continues, over the lifetime of the parliament the taxpayer will have to foot a bill of over £1bn. It makes no financial sense to pay public servants to leave, while paying others to join. More enlightened personnel practice would involve a properly managed redeployment process whereby posts that need to be refilled are ring-fenced and advertised within the service when they become vacant.
And yet the government is encouraging further wasteful practice by recruiting agency labour. The scale of this practice is enormous; the central civil service alone has paid employment agency fees of over £30m in the last quarter. In some cases, there were anomalous results. Last quarter, for example, the Wales and Northern Ireland offices paid retainer fees of nearly £25,000, and yet they astonishingly only recruited two employees between them – a scandalous waste of taxpayers money.
The widespread use of agency labour while mass redundancies are being enacted is expensive and wasteful, but it is also damaging for services as a whole. The British system traditionally had high standards of loyalty, an ethos of neutrality and public service. Agency workers are often temporary and are usually employed on lower incomes, with worse terms and conditions than permanent employees.
The government is supposed to have a freeze on public sector recruitment yet last week – as every week – there were nearly a thousand posts being advertised on the civil service website. One quick trawl revealed that the total value of posts being advertised on a single day was over £27m in annual salaries, including a number of posts with basic salaries of over £120,000 per year. On the day it announced the bonus review, the government casually advertised the post of chief executive at Natural England at a salary of £145,000 and of chair of Ofwat at £100,000 per year for a three-day week.
The Office for Budget Responsibility has estimated that in the wider public sector, 710,000 public employees will be laid off. It is likely, therefore, that we have only seen the tip of the iceberg in redundancy costs. Last week we learned that the much-reviled health and social care bill will now cost an extra £660m as a result of the government making NHS employees redundant. What is staggering is that there appears to be no proper control over which posts need to be replaced and which do not. It is clear that the government’s left hand doesn’t know what the right hand is doing. The package of swingeing cuts is now increasingly acknowledged as being the wrong approach; it is cutting too far and too fast and doing lasting damage to our economy. What has not been fully understood until now is just how wasteful and inefficient such kneejerk policies actually are.
Somewhere deep in their psyche, this generation of Tories think they were born to rule. But government is a complex and difficult process. In their ideological haste to downsize the state and attempt to reduce its expenditure, they are costing the country dear – not just financially, but in skills, morale and expertise. Their attempts to reduce the cost of the public sector are simply the latest in a long line of policy blunders that have already damaged the morale, professionalism and expertise of the public services on which Britain has relied on and been so proud of.
Jon Trickett MP, Labour’s Shadow Minister for the Cabinet Office, responding to the announcement on Government savings estimates by Francis Maude, said:
“Let’s be clear, the Cabinet Office has offered no hard evidence at all for these new estimates.
“The figures announced by Francis Maude today are plucked out of thin air in a vain attempt to disguise the complete failure of the Government’s reckless and unsubstantiated approach to cost-cutting.
“It is laughable for the Cabinet Office to claim that they are determined to get value for taxpayers’ money when their IT bill has gone up by 180 per cent in the last year alone. This kind of increase is completely inexplicable and shows just how little this Government can be trusted when it comes to pledges and promises.
“Without making fundamental changes, it will be impossible for the Government to achieve the savings it has announced today.”
Jon Trickett MP, Labour’s Shadow Minister for the Cabinet Office, has sent a letter to Sir Jeremy Heywood regarding reports today of briefings from Downing Street against Andrew Lansley. In the letter he said:
“Today, a column by Rachel Sylvester in The Times quotes a Downing Street source saying: “Andrew Lansley should be taken out and shot.”
“I know that you will be concerned about such anonymous briefing from within Downing Street.
“Indeed, in December, the Prime Minister rightly distanced himself from remarks made by his friend, Jeremy Clarkson, who had suggested that public sector workers should be “taken out and shot”.
“Will you now launch an investigation into how a Downing Street source could make similarly tasteless remarks about a member of the Cabinet?
“Ms Sylvester’s column also quotes an “exasperated insider” saying that Mr Lansley has been “a disaster” who, far from winning over critics of the Health Bill, has managed “to further annoy and alienate NHS staff”.
“Can you say if the Government now proposes to listen to hundreds of thousands of doctors, nurses, midwives and others and abandon this proposed legislation before it does great harm to the NHS and obstruct the reforms needed to help our health service?
“Can you also say if, rather than trying to blame everyone else, the Prime Minister will take responsibility for the consequences of his own decisions on the NHS?
“Finally, Ms Sylvester’s column quotes a strategist suggesting that, in future, “health reform should be carried out by stealth”.
“Can you reassure the public there will be no such covert attempt to bring about fundamental change in the ethos or the care offered by our National Health Service?”