Privatising IT and HR considered as possible Whitehall cost-savers

The government is considering establishing public service companies to privatise IT and human resources for its Whitehall departments, Sky News reports.

The companies could outsource “back office” functions for the civil service and would potentially raise billions in public revenue, Sky sources said.

According to Sky, an estimated 30,000 jobs would be shifted into the specially created corporate entities.

Sky’s City editor Mark Kleinman said: “These companies would essentially take over traditional Whitehall back office functions like human resources, IT and potentially part of the government’s vast property portfolio.”

“When you think about the vast scale of the public deficit at the moment, this potentially could have more of an impact on reducing that than the £3bn Gordon Brown mentioned today.”

In April, Personnel Today reported that nearly 6,000 government HR jobs are likely to face the chop after the chancellor agreed plans to speed up the introduction of shared services across departments in his Budget.

A report by former Logica boss Martin Read, which was fully endorsed by the Treasury, said cost savings of between 25% and 30% could be achieved if government departments and quangos adopted a radical re-engineering of back-office functions and introduced shared services.

Comments are closed.