Dr. Gareth Osborne, Director General of APA, has welcomed the £6.24 billion package of public spending cuts for 2010-11 announced earlier today by the Chancellor of the Exchequer and the Chief Secretary to the Treasury:
"These are tough but necessary reductions and made in an urgent attempt to regain financial stability for the UK economy. The Government is right to focus on public sector spending and particularly Quangos, IT expenditure, external consultancy, advertising and civil service recruitment. It makes sense to reduce spending by Regional Development Agencies and on those training and employment measures found to offer a poor return to the taxpayer.”
The Treasury document makes no explicit reference to the impact of today's package of cuts on public sector employment but CIPD suggests the combination of a civil service recruitment freeze and reduced spending in other areas is likely to reduce total public sector employment by around 50,000 in the current financial year. In addition there will be knock-on effects into the private sector on businesses that undertake contract work for the central and local government and other public bodies, plus the wider impact on demand for labour in the economy as a whole resulting from lower net public spending of around £6 billion. Given the current weak state of the labour market this is likely to have a detrimental impact on unemployment.
Questions remain about whether this is the right time to enact these cuts but Ministers clearly consider the risk of failing to take immediate steps to cut the fiscal deficit outweighs that of starting to cut too soon.
APA will be watching closely the impact on business critical departments and especially any impact on its own Members in the public sector. Any damaging consequences will be taken up with Ministers in the forthcoming round of discussions APA has scheduled with the new Government.
APA
"These are tough but necessary reductions and made in an urgent attempt to regain financial stability for the UK economy. The Government is right to focus on public sector spending and particularly Quangos, IT expenditure, external consultancy, advertising and civil service recruitment. It makes sense to reduce spending by Regional Development Agencies and on those training and employment measures found to offer a poor return to the taxpayer.”
The Treasury document makes no explicit reference to the impact of today's package of cuts on public sector employment but CIPD suggests the combination of a civil service recruitment freeze and reduced spending in other areas is likely to reduce total public sector employment by around 50,000 in the current financial year. In addition there will be knock-on effects into the private sector on businesses that undertake contract work for the central and local government and other public bodies, plus the wider impact on demand for labour in the economy as a whole resulting from lower net public spending of around £6 billion. Given the current weak state of the labour market this is likely to have a detrimental impact on unemployment.
Questions remain about whether this is the right time to enact these cuts but Ministers clearly consider the risk of failing to take immediate steps to cut the fiscal deficit outweighs that of starting to cut too soon.
APA will be watching closely the impact on business critical departments and especially any impact on its own Members in the public sector. Any damaging consequences will be taken up with Ministers in the forthcoming round of discussions APA has scheduled with the new Government.
APA
2 comments:
I think we all saw this one coming! As a junior civil serveant I must say I am a little concerned about the need for further and more significant cuts and feel the departmental PAs, who are still largely undervalued, may be on the hit list.
Helan I sincerely hope that PAs are not on the hit list, I talk to PAs at BIS very regularly and they are all incredibly efficient, hard working and in my experience have a huge amount of knowledge. I wish you well.
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