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MilitaryLatest NewsEconomics, government & business

Department for Business, Innovation and Skills could face cuts of £700m

by Personnel Today 24 May 2010
by Personnel Today 24 May 2010

The government’s business department is expected to face a budget cut of £700m as part of a bid to reduce public sector spending.

The coalition government is set to reveal today how the £6bn savings targeted for this year will be realised.

According to the BBC, the department for Business, Innovation and Skills (BIS) could be forced to make savings of up to £700m, which will result in significant cuts to regional development agencies.

But the Times has reported the cuts to BIS could reach up to £900m.

Deputy prime minister Nick Clegg admitted the cuts would be “painful and controversial” but said it was “quite right” that BIS should shoulder its fair share of the cuts.

It is also expected that a further £500m of savings will come from the trimming or axing of public bodies.

Quangos will also be affected by the cuts, with £513m predicted to be sought from the scrapping and scaling back of the bodies.

Quangos that could be scrapped include the Qualifications and Curriculum Development Agency, which employs 723 people, the South East England Development Agency, which has 270 staff, and the 40-strong Infrastructure Planning Commission.

According to the Times, at least 300,000 public sector jobs could also be lost as the coalition government starts cutting the £156bn budget deficit.

These job losses are expected to include tens of thousands of health service managers as well as many thousands of doctors and nurses, according to internal documents from the NHS, seen by the newspaper.

Police forces will also be affected, with the Met Police alone forecasting 445 job cuts.

Some 100,000 council workers across the country could also lose their jobs.

Meanwhile, about 20,000 jobs could go at the Ministry of Defence (MoD), as the department tries to reduce its administrative costs by 25%. Insiders at the MoD warned the cuts will hit military personnel, including some front-line soldiers.

The cuts to be announced today are also likely to include severe restrictions on Whitehall travel and accommodation.

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A Treasury audit of Whitehall spending has revealed officials spend £125m a year on taxis, £320m on hotels and £70m on flights.

It is also thought there will be savings on the universities budget and reductions in administration costs. The new government has already announced that it intends to spend less on consultancy and restrict public sector recruitment.

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