The cuts will go alongside contract renegotiation, where up to £3 billion savings would be targeted, according to a report in the Financial Times. They are part of £12 billion proposed savings, on top of the £15 billion already targeted by Labour, almost doubling the amount.
Gershon, a former adviser for the Labour party’s own cost cutting plans, told the newspaper that the cuts were achievable and that the government’s smaller targets demonstrated a lack of “pace and real focus”.
Some of the savings, £2.5 billion, would be generated by the Conservatives cutting consultants and staff expenditure, he said. In a move likely to cause anger, up to 40,000 public sector posts will also disappear as part of an attempt to save a further £2 billion. Some of this will come through not refilling roles as they become vacant, as well as employing fewer agency staff.
Labour today derided the plans as unrealistic. Prime minister Gordon Brown labelled them as “back of the envelope” calculations that could never be delivered.
Richard Holway, chairman at IT analyst house TechMarketView, said a shift to more offshored systems would likely become an area of focus and deliver “considerable” savings. But he warned of the negative effects on UK employment, adding: “A real and open debate is needed.”