The costs that come before savings
It’s a simple fact of politics that many measures which would save money in the medium-to-long term incur costs in the short term. Normally, this point is brought up in relation to public service reform – e.g. Gove’s Swedish Schools agenda. But today’s FT highlights a similar effect in relation to public sector redundancies. The important fact is that “civil servants aged under 50 can receive up to three years’ pay if made compulsorily redundant, and those who joined before 1987 more than six years’ pay”. This means that there are actually massive upfront cash costs to cutting jobs across the public sector, whatever the potential savings further down the
