Cabinet minister Pat McFadden has insisted that he will “not take a chainsaw to the civil service” as fears grow of an Elon Musk-style cost cutting exercise.
The chancellor of the Duchy of Lancaster, who runs the Cabinet Office engine room of Whitehall, denied he had set targets for job cuts as he announced a major overhaul of the civil service.
Mr McFadden – sometimes wryly referred to as Keir Starmer’s unofficial deputy prime minister – made his remarks on Sunday after unveiling a series of hard-hitting reforms to Whitehall.
He also made it clear that the government plans significant cuts to benefits, targeting those on long-term disability payments. This is despite revelations that ill and disabled people are already waiting too long for payments.
But as well as cutting jobs deemed unnecessary, pay will be linked to performance as chancellor Rachel Reeves also exerts pressure to find savings to help her cover an increase in defence spending from 2.3 per cent to 2.5 per cent of GDP.
The proposals have echoes of Elon Musk’s Department of Government Efficiency (DOGE) in the US, which has already seen massive cuts to aid as well as initiatives such as federal employees receiving emails asking what they have done this week.
The tech tycoon recently demonstrated his approach to slashing the cost of government by appearing on stage at the Conservative Political Action Conference (CPAC) in Washington DC, brandishing a jewel-encrusted chainsaw gifted to him by Javier Gerardo Milei, the president of Argentina.
But speaking to Times Radio, Mr McFadden said: “We won’t take a chainsaw to the civil service.”
He was also critical of past Tory governments under Boris Johnson and Rishi Sunak, which set targets of 90,000 and 60,000 job losses in Whitehall respectively.
Speaking to the BBC’s Laura Kuenssberg later, Mr McFadden insisted it is not an “ideological approach to stripping back the state”, but said that the government does want to get “bang for our buck”.
Part of the plan will see one in 10 civil servants employed in a digital or data role within five years.
Asked how radical they are willing to be, Mr McFadden told the BBC: “Performance management is part of every big organisation, but it’s an important thing for you and your viewers to remember: we’re a centre-left government.
“We believe in good public provision, that’s why we fought the election, saying we wanted to have more teachers in schools, more neighbourhood police officers, why we wanted to get waiting lists down.
“It is part of what we believe in that the state can provide both security and opportunity for people.
“That will guide us in our actions, it’s up front in our policies, so we will be radical about this, but it’s about getting bang for our buck in terms of the outcomes for the public, it isn’t an ideological approach to stripping back the state.”
However, TUC general secretary Paul Nowak expressed disappointment about the government’s approach.
He said: “I think these are a set of proposals that look more about grabbing headlines rather than about a serious plan for reforming our public services. Our millions of public sector workers who are in unions are up for that discussion about public service reform.
“If you’re working in the civil service or in a hospital or in a school you know what needs to be done to make those services run better, to be delivered more efficiently, more effectively.”
Mr McFadden said “the state is not match-fit to rise to the moment our country faces” as he added ministers will “fundamentally reshape” the service.
However, a union has described the plans as a “retreading of failed narratives” and accused the government of delivering a “soundbite, not a credible plan for change”.
It is one in a series of reforms expected to be set out by the government this week that will also cover housing and regulation.
Meanwhile, Mr McFadden was much clearer about benefits, saying 2.8 million people of working age not working but collecting disability payments was unacceptable. He warned that, if untouched, this number would soon increase to 4 million.
“The clue is in the name: we are the Labour Party, we are the party of work,” he said.
The reforms will go alongside what officials are calling an “intervention” from the prime minister on Thursday.
In the plans to be announced by Mr McFadden at the start of the week, he will promise a new “mutually agreed exits” process, in which civil servants who cannot perform at the level required of them are persuaded to leave their jobs.
The system will be designed to give bosses more tools to address bad performance.
Alongside the exit processes, senior civil servants who are not meeting standards will be put on development plans, with a view to being sacked if there is no improvement within six months. The most senior officials will have their pay linked to performance outcomes.
He will also pledge to increase the government’s digital capabilities, with more staff to be employed in relevant roles and more public services to be digitised.
Dave Penman, general secretary of civil servant union the FDA, said that meaningful reform “must put substance before headlines” and any announcement that points the finger at public staff “only reinforces the sense that the government lacks of a credible long-term plan”.
“If the government is serious about transforming public services they must set out what the substance of reform looks like, not just the retreading of failed ideas and narratives,” he said.
