Whitehall in private sector shake-up plan

Up to 75,000 jobs at stake in coalition plans to move civil servants into 'John Lewis economy'

By James Ashton

Business Editor

Thousands of civil servants will be transferred into the private sector under a blueprint to shake up Whitehall that will be unveiled next month.

Plans to identify central government operations that can be spun out and commercialised could affect one in six civil servants, or 75,000 staff.

It is the next step in the Government's vision to foster a "John Lewis economy" of employee-owned businesses and reduce the bloated public sector. Chancellor George Osborne is expected to talk up the progress made in Whitehall reforms in his Budget on Wednesday.

New recommendations on spin-outs are due next month in a report by Stephen Kelly, the former chief executive of software provider Micro Focus. It is expected to say that there are numerous government operations that could be potentially commercialised, either through forging partnerships with outside firms or seeking capital injections.

The coalition is a fan of mutuals, claiming they are more productive than other companies, more resilient in a downturn and suffer from lower levels of absenteeism. Ministers want to lift their contribution to the UK economy from the current 2 per cent. With that in mind, Deputy Prime Minister Nick Clegg last week announced a review that could lead to tax breaks for employee-owned companies.

My Civil Service Pension (MyCSP), a Whitehall division that handles the retirement funds of 1.5 million civil servants, was selected last year as the first operation to be moved into the private sector. Ministers plan to sell a stake to a commercial partner but also hand shares to staff.

Francis Maude, the Cabinet Office minister, has led the charge to reduce central government costs, including a clampdown on the use of management consultants. But, the National Audit Office warned last week that even though Whitehall had slashed its annual wage bill by £400m by axing 17,800 staff, there was a risk staffing levels would have to be bolstered again unless working practices changed.

The Cabinet Office has recruited Ed Welsh from investment bank Rothschild to lead the work on using new business models such as mutuals.

"Introducing new models for delivering public services will increase the quality and value of services, and unlock growth, saving money for the taxpayer," Mr Maude said.

Voices
Scotland's First Minister Alex Salmond delivers his speech at the Scottish National Party (SNP) Spring Conference in Aberdeen, Scotland April 12, 2014.
voices
Arts & Entertainment
artYouth club owner says mural is 'gift from the sky' so he can prevent closure of venue
News
Plans to decriminalise non-payment of television licence fees would cost the BBC £500m according to estimates drawn up within the Corporation
people
Arts & Entertainment
Jessica Pare as Megan Draper and Jon Hamm as the troubled, melancholy Don Draper
tvAnd six other questions we hope Mad Men series seven will answer
VIDEO
Life & Style
The new low cost smartphone of Motorola, 'Motorola Moto G', is displayed in Sao Paulo, Brazil on November 13, 2013. The smartphone, with dimensions 65.9mm W x 129.9mm H x 6.0 - 11.6mm D is equipped with a Qualcomm Snapdragon 400 with quad-core 1,2 GHz CPU, a 4.5-inch display and Android Operating System 4.3 and a suggested price of $ 179 USD.
techData assessing smartphones has revealed tens of millions of phones are at risk of being harvested
Arts & Entertainment
Cody and Paul Walker pictured in 2003.
film
News
David Beckham is planning to build a stadium in Miami’s port for a new football team he will own
news... in his fight for a football stadium in Miami's port area
News
weird newsMan live-photographs cracking of mysterious locked box on Reddit
Sport
Oliver Giroud kisses the Arsenal badge after giving the Gunners the lead
sportArsenal 3 West Ham 1: Two goals from the German striker and one piece of brilliance from Giroud puts the Gunners back above Everton
News
weird news
Arts & Entertainment
Seeing red: James Dean with Sal Mineo in 'Rebel without a Cause'
filmAs 'Rebel without a Cause' is re-released, Geoffrey Macnab reveals how its star James Dean perfected his moody act
News
Obesity surgery in rats has been found to change the way the body processes alcohol
news
Arts & Entertainment
Heads up: Andy Scott's The Kelpies in Falkirk
artThe Kelpies are the latest addition to a growing army of giant sculptures. But naysayers are asking what a pair of gigantic horse heads tells us about Falkirk?
Life & Style
US Airways has been at the centre of a Twitter storm after it responded to customer complaints with a graphic sexual image
techUS Airways takes an interesting approach to customer service
Arts & Entertainment
Philip Arditti as Yossarian and Christopher Price as Milo Minderbinder in Northern Stage's 'Catch-22'
theatre
Life & Style
Back to nature: women with body issues have found naked yoga sessions therapeutic
lifeDoing poses in the altogether is already big in the US, and now it’s landed here – in mixed classes
Have you tried new the Independent Digital Edition iPad app?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Data Analyst - Financial services, Client data, LEI

£40000 - £50000 per annum + BONUS + BENEFITS: Harrington Starr: A leading, Cit...

Management Consultancy - Operational Research Analysts

£35000 - £50000 per annum + Bonus + Benefits: Pro-Recruitment Group: You must ...

Corporate Actions Consultant - Market data, ISO15022, presales

£45000 - £60000 per annum + BONUS + BENEFITS: Harrington Starr: Corporate Acti...

Prudential Risk/Operational Risk Associate - London

£350 - £400 per day: Harrington Starr: An opportunity has arisen at a FCA regu...

Day In a Page

Homelessness: Why is the supported lodgings lifeline under threat?

Why is the supported lodgings lifeline under threat?

Zubairi Sentongo swapped poverty in Uganda for homelessness in Britain. But a YMCA scheme connected him with a couple offering warmth and shelter
A History of the First World War in 100 Moments: When the world’s biggest shed took over Regent’s Park

A History of the First World War in 100 Moments

When the world’s biggest shed took over Regent’s Park
The pain of IVF

The pain of IVF

As an Italian woman vows to keep the babies from someone else’s eggs, Julian Baggini ponders how the reality of childbirth is often messier than the natural ideal
Supersize art

Is big better? Britain's latest super-sized art

The Kelpies are the latest addition to a growing army of giant sculptures. But naysayers are asking what a pair of gigantic horse heads tells us about Falkirk?
James Dean: Back on the big screen

James Dean: Back on the big screen

As 'Rebel without a Cause' is re-released, Geoffrey Macnab reveals how its star perfected his moody act
Catch-22: How the cult classic was adapted for the stage

How a cult classic was adapted for the stage

More than half a century after it was published 'Catch-22' will make its British stage debut next week
10 best activity books for children

10 best activity books for children

Keep little ones busy this bank holiday with one of these creative, educational and fun books
Arsenal 3 West Ham United 1: Five things we learnt from the battle between the London sides

Five things we learnt from Arsenal's win over West Ham

Arsenal still in driving seat for Champions League spot and Carroll can make late charge into England’s World Cup squad
Copa del Rey final: Barcelona are paying for their complacency and not even victory over Real Madrid will put things right

Pete Jenson on the Copa del Rey final

Barcelona are paying for their complacency and not even victory over Real Madrid will put things right
Rafa to reign? Ten issues clay courts will serve up this season

Rafa to reign? Ten issues clay courts will serve up this season

With the tennis circus now rolling on to the slowest surface, Paul Newman highlights who'll be making the headlines – and why
Exclusive: NHS faces financial disaster in 2015 as politicians urged to find radical solution

NHS faces financial disaster in 2015

Politicians urged to find radical solution
Ukraine crisis: How spontaneous are the pro-Russian protests breaking out in Ukraine’s east?

Ukraine crisis

How spontaneous are the pro-Russian protests breaking out in Ukraine’s east?
A History of the First World War in 100 moments: The first execution at the Tower of London for 167 years

The first execution at the Tower of London for 167 years

A history of the First World War in 100 moments
Fires could turn Amazon rainforest into a desert as human activity and climate change threaten ‘lungs of the world’, says study

New threat to the Amazon rainforest:

Fires that scorch the ‘lungs of the Earth’
Liverpool, Chelsea and Manchester City: And the winner of this season’s Premier League title will be...

Who’s in box seat now? The winner of the title will be ...

Who is in best shape to take the Premier League prize?