Scottish ministers urged to provide clarity over plan to reduce public sector workforce

Scottish ministers have been urged to provide clarity on their plans to reform the public sector and reduce the workforce.

Holyrood's finance and public administration committee called on the Scottish Government to set out where "reductions in headcount to pre-pandemic levels will be made".

Elsewhere, it said ministers were “firefighting” through considerable financial challenges as they battle the cost-of-living crisis and the demand for improved pay deals.

It came as the committee published its report on the 2023/24 budget after Deputy First Minister John Swinney set out the fiscal plans in December.

Deputy First Minister John Swinney

The committee urged ministers to focus on striking the right balance between responding to the immediate financial pressures of high inflation and the cost crisis and addressing longer-term fiscal concerns.

Its report also noted the “expected plans for public service reform have disappointingly not materialised, presenting difficulties for public bodies in their long-term financial planning and service delivery”.

Ministers set out objectives to reduce the size of the public sector workforce back to pre-pandemic levels by 2026/27. This would mean a cut of about 7.3 per cent over the four years, or 1.9 per cent a year, according to the Institute for Fiscal Studies.

SNP MSP Kenneth Gibson, the committee convener, said: “The Scottish Government’s focus on addressing the cost-of-living impact is understandable given the scale and immediacy of the challenge. The committee also acknowledges the difficulties arising from soaring inflation this year and the knock-on implications for public sector pay and public spending overall.

“However, we would like to see evidence that the Government is suitably focused on striking the right balance between responding to the immediate financial pressures and addressing long-term fiscal challenges.

“On the basis of evidence we’ve heard, the committee wants to see more strategic long-term financial planning from the Scottish Government to ensure future fiscal sustainability. This includes how it will meet its public service reform and social security commitments.

“We also ask in our report, from where in the public sector reductions in headcount to pre-pandemic levels will be made, and to what timescales.

“Clarity and transparency around these issues are crucial, during what is an uncertain time for the public sector.

“It is clear from our scrutiny of the Scottish Budget 2023/24 that the Scottish Government is firefighting on a number of fronts.”

Mr Swinney said: “These recommendations are an important step in the scrutiny of the Budget. This year’s Budget faces very significant challenges as a result of the current particularly turbulent economic period and we have had to take difficult decisions to focus on key priorities. The 2023/24 Scottish Budget focuses on eliminating child poverty, investing in public services and supporting the transition to net zero.”