where is Rachel Reeves hoping to make savings?

Rachel Reeves is planning to eliminate 10,000 civil service positions as part of a £2 billion Whitehall efficiency drive.

By 2029–30, the Labour chancellor has urged mandarins to cut 15 per cent of departmental administrative expenditures, saving an estimated £2.2 billion annually. She said the money would be used for front line services. The cuts are part of an evaluation of government spending that is examining every aspect of public sector expenditure.

Ms Reeves said on the BBC’s Sunday with Laura Kuenssberg that the government wanted to use savings to fund its priorities, including the NHS. According to her, the civil service had grown massively during Covid and had not gone back to its pre-pandemic size.

“We are, by the end of this Parliament, making a commitment that we will cut the costs of running government by 15%,” she said.

According to Ms Reeves, reducing operating expenses by this sum was “more than possible” thanks to technological and artificial intelligence advancements.

What cuts are being made to the civil service?

By the conclusion of this Parliament, the chancellor said, Labour aims to reduce the size of the civil service, which she said had grown during the Covid-19 pandemic, by reducing its “back office functions, the administrative and bureaucracy functions”.

Civil servants are government employees who are not political appointments and work in areas such as government departments and policymaking and in services such as the benefits and criminal justice systems.

As of December 2024, an estimated 514,000 people were employed by the civil service according to a website set up by a former civil servant. This includes temporary and casual employees.

The chancellor rejected a return to the austerity brought in by the Conservative predecessors. However, the head of the largest civil service union said any reductions would affect front line services, which have been underfunded for years by past Conservative administrations.

Public and Commercial Services union general secretary Fran Heathcote said: “The impact of making cuts will not only disadvantage our members but the public we serve and the services they rely on. We’ve heard this before under Gordon Brown when cuts were made to backroom staff and consequences of that was chaos.”

And while the chancellor said she is confident civil service numbers could be cut by 10,000 without damaging the quality of public services, the FDA general secretary Dave Penman told ITV that “up to 50,000 staff” could be affected.

He said: “We’re talking about something that’s close to 10% of the entire salary bill of the civil service over the next three to four years.

“The civil service is about half a million staff. So that could be up to 50,000 staff who would go.”

Which areas will be most affected?

It is expected that areas including office administration, communications, policy guidance and human resources will be targeted.

When asked which roles will be made redundant, Ms Reeves told Sky News: “It will be up to every department to set out those plans. But I would rather have people working on the front line in our schools and our hospitals and our police, rather than back office jobs.”

The chancellor also said there would be cuts in areas such as travel budgets, consultants and communications.

This week, Pat McFadden, the chancellor of the duchy of Lancaster, will give instructions to civil service divisions, according to the Telegraph.

A Cabinet Office source told Sky News: “To deliver our plan for change we will reshape the state so it is fit for the future. We cannot stick to business as usual. By cutting administrative costs we can target resources at front line services – with more teachers in classrooms, extra hospital appointments and police back on the beat.”

Mr Penman said that although the union applauded the departure from “crude headcount targets” the distinction between the front line and back office was “artificial”.

“Elected governments are free to decide the size of the civil service they want, but cuts of this scale and speed will inevitably have an impact on what the civil service will be able to deliver for ministers and the country … The budgets being cut will, for many departments, involve the majority of their staff and the £1.5 billion savings mentioned equates to nearly 10 per cent of the salary bill for the entire civil service.”