Wednesday, 1 July 2009

It Ain't What You Cut...

It's the Way that You Cut It !!

Everybody knows public spending cuts are on the way whether they like it or not. Supporters of cuts claim that the disastrous state of the public finances mean the "next Government" i.e: the Conservatives will have to make real deep cuts across the board to rebalance the books.

The figures don't disprove that at all but behind this apparent good sense is a vindicative desire among some to emasculate the public sector. Some Tory activists clearly view public sector workers as Labour core voters and want to see that core vote destroyed. However, beyonf the pen-pushers are an army of poorly-paid, often part-time and female workers who keep the public sector going and who have a large residue of public support and therein lies the problem.

As someone who has worked in or near the public sector for twenty years, those who believe that the "cuts" or "efficiency savings" will sinngle out the "pen pushers" are deluding themselves.

Let's start with the most senior posts - departmental heads and points higher. Chief Executives and many of these posts are not "permanent" but on some form of contract. This has driven salaries ever higher so that £200k is approaching the norm. While it is of course possible to sack these staff, it doesn't usually happen and there is often a considerbale "pay off" for the person involved.

The next level are the ubiquitous "middle managers". Now, their fate depends on how any process of cuts or rationalisation is done. IF it is done wholly internally, the senior staff will delegate the task down and of course those in charge of the process will ensure they themselves are secure. IF it is done externally and this usually means a group of highly-paid Consultants, then middle management does take a hit but this can often be counter-productive for the Authority as the "victims" are often those with experience and contacts both inside and outside the Authority. The sudden loss of talent can be damaging for the Authority and of course the experienced staff then start drawing on the pension fund to which they have of course contributed.

So, it's not as easy to "cut" in local Government as you might think and the results aren't likely to be positive in terms of service delivery.

Yet, we will doubtless see the main parties engaging in a dutch auction to see who can cut most. One thing that will change with a change in Government is likely to be the way local Government itself is funded. Under John Precott and his successors, there was a deliberate movement of financial resources from southern County authorities to northern and inner-city Authorities.

In 1991, after the end of the Poll Tax, the "settlement" brokered by John Major and Norman Lamont left local Councils raising just 24p in every £ locally with 76p coming from central Government. Yet now some Authorities are almost wholly financed from the centre while others have to raise up to 50p in every £ locally. The "swingback" of resources will be deeply painful for northern and inner-city boroughs and Districts and this is where the cuts will be the harshest.

We are already seeing jobs going at many local authorities ranging from the London Boroughs of Westminster and Merton to Surrey County Council and many more will be lost in the years to come. However, in areas like education and the provision of domicilary and residential care for adults and children, demand is growing and inflation in these areas often runs well above RPI. At a time of cuts, the "front line" has enjoyed some protection in the past but that may not be the case in the austere 2010s and many hundreds of people are likely to see a significant deterioration in the quality of their existence as a result.

But then those who just want to see the "pen pushers" and the "diversity managers" at the Job Centre and those who believe everyone in the public sector votes Labour and hates Conservatives aren't going to be worried about that, are they ?

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