Private and public sector cuts – by John Redwood MP

The endless rows over “cuts” at a time when public spending continues to rise in cash terms highlights yet again the totally different approach to public service by the private and public sectors.

In 2008-9 many private sector companies faced declines in their revenue of 25% or more. This was all far more horrific than the cash figures for the public sector this year and next. I do not recall these companies appearing in the media telling us they would have to take lumps out of their service to customers, identifying in public ways they could make their service or product worse, or proposing strikes to complain about the loss of public revenue support.

Instead they got on with the difficult but essential task of bringing costs down to meet the reduced revenue. Managers and workers worked together to reduce stocks, cut costs without damaging customer service, accepted pay freezes or even cuts in remuneration for the bad times, lost pension benefits and bonuses, negotiated cheaper purchases from suppliers. They often also at the same time worked on how they could improve their service or product for customers.

I am pleased to see the government seeking to cut out the inessential, and press the message of value for money within the public sector. Councils, the remaining quangos, MPs and others need to learn the same approach.

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