Government Cuts: A view from the inside

Earlier this week I was at St Pancras Station when another woman struck up a conversation with me.  By chance would have it, she was a senior HR professional working the civil service.  On our 25 minute journey home we covered a lot of topical issues including the subject matter I blogged about earlier this week: the fact that the Govenment is looking at making 40% cuts in their budgets.

These are some of the challenges that my colleague in the civil service is facing:

1. The demographic of the workforce:  45% of the staff are aged between 50 and 60, combined with a length of service of c.30 years.   The cuts will enable the organisation to shed some “dead-wood”, but there is also a risk of loss of organisational memory and technical expertise.

   2. Another impact of this demographic is the cost of redundancies.  Most will be entitled to the full-payout, and in this organistion that’s equivalent to three years pay!  The organisation has already taken considerable steps with the unions to negotiate a reduction, but I understand that goverment is frustrated by the delays in this process.  So, they have halted the negotiations and instead have announced that they are going to pass a piece of legislation to reduce the redundancy to the equivalent of a year’s pay.  But it will be some time before this will become a reality.

3.  A third impact relating to the demographic of this workforce is the lack of flexibility.  Many of these staff have been based in a local office, perhaps 10 – 20 minutes from their home for 20+ years.   Many of the local offices are being closed as part of the cost savings, and the organisation is now asking them to travel 30 – 40 minutes instead.  These staff will still have a job, but they are resistent to the change.  A considerable amount of time is being spent responding to staff’s queries and questions relating to the relocation (Will I have a car-parking space?).  Whilst on the face of it these are minor questions, they matter to every individual who is affected.

4.  The attitudes of the senior team:  they hold a belief that HR will find a job for everybody eventually.  But my HR colleague keeps telling them that this is highly unlikely.   The culture needs to shift from being a “welfare” workplace and until that happens the staff on the ground will hear mixed messages, causing greater anxiety and lower productivity.

5.  The organisation is already working to make 10% savings year-on-year for the next 5 years.   My concern is the approach to making 25% or 40% cuts is different to that when an organisation is looking to make 10% cuts.  There needs to be a firm decision about the level of cuts that need to be made, otherwise time could be wasted “tweaking” the edges instead of investing time and energy making significant cuts.

I’ve only touched on the top 5 challenges in this blog, and naturally there will be many, many more.  The lady on the train was energetic and spirited about the challenges that lay ahead and I admire this positive approach.   She’s got a rough ride ahead.

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6 comments on “Government Cuts: A view from the inside

  1. Sarah says:

    I admire her energy and enthusiasm too because we all need people like that, but at the risk of sounding churlish: if she is a senior HR person, her job is safe, so why shouldn’t she be upbeat? I had a similar reaction listening to the head of my public-sector organisation speak to a group of staff a short time ago. All I could think was – “I know you mean well, but you are only one of two people in this room who knows for certain that you will still have a job by Christmas, aren’t you?”

    • karencwise says:

      I think you’re right. As a HR professional, you can never truly understand how it feels when someone is told that they might loose their job.

      What I was thinking about when I wrote that sentence comes from my own experience. For a period for 18 months I was constantly having to tell staff that they were going to be made redundant. It’s hard to remain upbeat and positive when you’re constantly giving bad news – particularly to people you like and care about.

  2. Rick says:

    Karen, I think if people have been there before 1987 they might be entitles to even more than three years pay – possibly up to six! You can see why the government is so keen to change these entitlements.

  3. Jenny says:

    It’s fine to talk about how people at the older end of the scale could have huge payouts, and they should be cut, but what about people at the younger? Moving to statuory-only reducndancy will give me about £3,000 for 7 years service. I’ve worked incredible hard for the CS, and it feels mean-spirited to be telling me my pension will be hacked (and I’m not on one of those big ones the senior managers get), I’ll lose my job and my redundancy will be the bearest minimum. I’m in my early 30s – all the organisations I know are facing huge cuts, so there aren’t other equivalent jobs to go to – the only way I can see I’ll cope it to sell my house and take a job at a lot less pay and responsibility. It’s devastating to face losing everything I’ve worked for for the past 10 years – and to have to put off starting a family on top of having to start everything from scratch.

    It’s not just the “dead-wood” that’s affected by this – and as ever, it’s the younger people, or people with young children who will be worst affected

  4. […] biggest HR project since the 1940s Posted on 12 July, 2010 by Rick A great post from Karen Wise recounts a conversation she had with a senior HR manager in the civil service who is trying to […]

  5. Andy Spence says:

    Hi Karen – great article which outlines the key challenges of the proposed changes. This was selected as one of the Top 10 HR Transformation Articles in July by HR Transformer Blog. Many thanks, Andy

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