By Mark Smulian
7 May 2010
Moving civil service administration posts abroad could save the biggest-spending Whitehall departments £50m a year, according to the consultancy industry’s trade body.
The claim came in a paper, We can cut the deficit, by the Management Consultancies Association. Author William Benn argued: ‘An immediate way for a new government to save money on the overhead cost of generic administration is to send the work offshore.
‘Traditionally, this has been too sensitive – for reasons of data privacy and security, and for the political concern about UK jobs being lost.’
But he said the outsourcing market was now robust enough to meet government demands on security.
Benn, who is head of public sector at outsourcing consultancy Alsbridge, said previous experience of moving services offshore suggested this could save an extra 30% on top of the 10%–20% achievable through shared services in the UK.
‘The top five spending government departments should be able to save around £10m each per year,’ he said.
Alan Leaman, chief executive of the MCA, said offshoring would not damage domestic employment because ‘there has been a large expansion of public sector employment over the past decade and there is no benefit in preserving inefficient jobs long term’.
He added that data security was ‘yesterday’s issue, as we live in a cyber world so it does not make much difference where data is held’.
Mark Serwotka, general secretary of the PCS trade union, whose members would be most affected by the idea, called Benn’s proposal ‘yet another crude and shortsighted cost saving scheme dreamed up by highly paid consultants’.
He said: ‘What offshoring government jobs effectively means is the loss of quality jobs, and what is never calculated is the loss of tax revenue. If 30,000 jobs were offshored, for example, that would be about £250m in lost national insurance and income tax revenue.’
7 May 2010
Moving civil service administration posts abroad could save the biggest-spending Whitehall departments £50m a year, according to the consultancy industry’s trade body.
The claim came in a paper, We can cut the deficit, by the Management Consultancies Association. Author William Benn argued: ‘An immediate way for a new government to save money on the overhead cost of generic administration is to send the work offshore.
‘Traditionally, this has been too sensitive – for reasons of data privacy and security, and for the political concern about UK jobs being lost.’
But he said the outsourcing market was now robust enough to meet government demands on security.
Benn, who is head of public sector at outsourcing consultancy Alsbridge, said previous experience of moving services offshore suggested this could save an extra 30% on top of the 10%–20% achievable through shared services in the UK.
‘The top five spending government departments should be able to save around £10m each per year,’ he said.
Alan Leaman, chief executive of the MCA, said offshoring would not damage domestic employment because ‘there has been a large expansion of public sector employment over the past decade and there is no benefit in preserving inefficient jobs long term’.
He added that data security was ‘yesterday’s issue, as we live in a cyber world so it does not make much difference where data is held’.
Mark Serwotka, general secretary of the PCS trade union, whose members would be most affected by the idea, called Benn’s proposal ‘yet another crude and shortsighted cost saving scheme dreamed up by highly paid consultants’.
He said: ‘What offshoring government jobs effectively means is the loss of quality jobs, and what is never calculated is the loss of tax revenue. If 30,000 jobs were offshored, for example, that would be about £250m in lost national insurance and income tax revenue.’
