How to get rid of public sector non-jobs

I went on the Today Programme last Saturday along with several other regular contributors to give one money-saving tip to our new government. Mine was to do with pensions. You can listen to what I said here (fast forward to 51 mins 45 secs), or read my full argument here: The UK’s pension rules are too generous.

But the core idea is pretty simple. We should cut the amount that we allow people to save into a pension so that they are able to save just enough to prevent them from being a burden on the tax payer in their retirement, and no more. Obviously they can still save as much as they like outside a pension – just not in such a way that it is subsidised by the taxpayer.

I suggested cutting the amount everyone is allowed to save every year to a not-exactly-mean £20,000. The financial industry would prefer the number to be more like £50,000: they say they like simplicity but they clearly don’t want any changes to hit their margins too much. Cutting it to £50,000 would save about £3.6bn a year (on industry figures). So, given that the cost of tax relief tends to be biased towards higher-rate tax payers, I think we can safely say that cutting the amount to £20,000 would bring the savings up towards a good £7bn. Not bad for a money-saving measure that really would only affect the much better off and that would remove the odd anomaly of the tax payer subsidising the vast pensions of the rich without making the whole system incomprehensibly complicated.

Some of the other speakers came up with slightly more radical ideas (Simon Jenkins thinks we should dump the armed forces in their entirety) and some rather less radical. But when I then looked at the next day’s Sunday Times I began to wonder why we were bothering with the out-of-the-box thinking at all. Why? Because the paper listed a horrible train of non-jobs still on offer in the public sector at vast salaries. You can read the original article here.

Read it and you will see that last Friday – just after Communities Secretary Eric Pickles announced around £1bn in cuts for local authority spending – councils were still advertising for the likes of a ‘Health, safety and wellbeing officer’ (Surrey, £34,524) to make sure that “staff take breaks, go for walks… that kind of stuff”. Then there was the advert for a media officer with “the skills to deliver positive stories about the council” (Newham, £36,000) and a “putting people first programme manager” (Herefordshire, £50,000 plus).

I find this really odd. The councils must know that their budgets are about to be slashed – contributions from central government are going to come down, and, as recession bites, so are their own revenues from council tax, parking and the like. So why, instead of taking action, are they carrying on spending on nonsense jobs? And just as importantly, who keeps voting the kind of people prepared to spend £180,000 on a head of communications (Suffolk) back in? Totally bemusing.

So how do we bring it to an end? Let’s not forget that the more we pay communications directors to issue good news, the more we’ll end up cutting the NHS budget in the end. The only answer is to encourage an outbreak of common sense.

A post on the Conservativehome blog suggests how: get someone sensible from central government (this will be the tricky bit) to visit every council and list all their non-jobs plus the cost of those non-jobs. Then add them up and subtract the total amount from each council’s central funding accordingly. That should do it.

  • Bob

    Councils are still hiring in order to pull the old trick of increasing their numbers prior to any cuts.

    Then, when they are forced to cut, it means that the last in will be first out and they hope that they will get away with the same numbers as before.

    I would be very wary about taking a public sector job at present, especially if it meant rellocating or giving up another job.

  • Phil

    A better way might be to set up a bonus scheme for senior public sector managers – if they can cut a certain amount from their budget, without affecting the measured quality of service, they get to keep a percentage of the savings.

  • Merryn Somerset Webb

    Phil, surely the last thing we need is another way for senior public sector managers to pay themselves even more… and why should they get extra for having a go at solving a problem they created? How about instead of getting extra bonuses for cutting spending they get to keep their own jobs on salaries a mere 15% lower than their current ones?

  • Phil

    Merryn,

    At the moment was is the incentive for a public sector manager to save money? The attitude is ‘I’ve got this budget, now I need to find a way to spend it’ – while arguing vociferously to the paymasters that they need more money. A bonus scheme would counter the expensive desire to build a work empire with the possibility for personally gaining from not doing so. Isn’t greed one of the most powerful motivators for action? (Probably stronger than the desire to save ‘the taxpayer’ money.)

    As for managers getting extra for sorting out the problems they created, that’s the way the world works. How many bankers at RBS have been sacked for gross incompetence in the last couple of years?

  • Christine Melsom

    If this is how the senior managers in the Public Sector think, then they should have been sacked long ago.
    The Leader of the council should make sure that department budgets are carried out and pruned every year. They are already paid handsomely to do this. I would be inclined to go the opposite way, insist their departmental budget shrinks, if it doesn’t – dock their pay. They would soon get the message

  • Howard

    Democracy means politicians will always spend tax payer money to buy “less wealthy” people votes. This is how the system works.

    As others mentioned, there is no incentive for civil servant managers to cut spending or reduce the number of staff. More staff more budget = more power in their minds. The only way to change the culture is by privatisation. We don’t vote for councillor, but councillor (management company) to bid for the council every 5yrs. By doing so, there will be extra incentive for the management to improve the local, by attracting more residents (i.e. income).

  • Louise

    I have a horrible feeling that cutting public sector jobs will mean losing the people who actually do useful things for modest pay so that the handsomely paid non-jobbers can stay.

    As a first step towards sanity, I suggest getting rid all managerial staff who have to words ‘inclusion’ or ‘wellbeing’ in their job titles. Having recently sat around a table with a crowd of fragrant and essentially useless ladies with such titles, I think there are some very important savings to be made.