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9th Dec, 2009 to 9th Feb, 2010
Article from People Management 9/12/2009
Whitehalls HR teams face “considerable cutbacks” as part of the latest back-office efficiencies sought by the government, PM has learnt. Consolidation of central governments back-office services was outlined in the Putting Frontline Services First: Smarter Government report, published on Monday.
The government plans to improve operations by publishing cost benchmarking data for all central government departments and most agencies and non-departmental public bodies with more than 250 staff. This will reveal the cost of HR, finance and other functions before the 2010 Budget. Overall, data released with the report revealed that these public bodies had a mean average of one HR worker for every 44 staff – a ratio that the government wants to reduce to the private-sector benchmark of 1:77.
“We have agreed stretching new comparators, informed by private-sector median performance, to support improvement in back offices,” said the report. “These include improving the ratio of HR staff to non-HR staff to 1:77, reducing the cost of finance functions to 1 per cent of organisational spend and reducing occupancy to 10 square metres per full-time member of staff.” John Philpott, CIPD chief economic adviser, told PM this would mean cuts. “The chapter on HR indicates that there will be quite considerable cutbacks over a period of time. They will make the Gershon review look like relatively small beer.
” He added that HR had been “over-managed numerically” and needed to change direction strategically. “You need fewer admin process HR staff at the junior levels and to at least maintain or increase at the higher level. Overall, it would mean fewer staff in HR roles in the broadest sense, instead rebalancing the reduced number towards more business and higher-level roles. This would mean a shift into more strategic roles alongside substantial cuts.
” The report proposes to achieve the efficiencies by expanding the most successful shared services centres, potentially creating the first shared-service company in the public sector. A specialist company of this kind could then offer services across the public sector, providing a platform for public organisations to transform their back offices more easily to reach private-sector benchmarking levels.
Another area targeted for improvement in the report was the management of sickness absence. The report said other departments could learn from the Department for Work and Pensions, which reduced the average number of working days lost by 1.8 days over an 18-month period, saving around £13 million in the process.
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