Through KPMG's experiences of working with a range of Public Sector organisations, our professionals provide views on how radical reform and cost cutting can be achieved.
The UK Public Sector is facing a period of austerity that will last for several years, possibly a decade. To tackle the looming Public Sector crisis, managers must take urgent action to reduce costs and improve productivity in order to maintain service quality.
KPMG's prospectus - The challenge facing the UK public sector - discusses the challenges faced by the public sector and sets out a three-stage approach to tackle the looming financial crisis.
Assuming year on year cuts of 5 percent or more from 2011/12 onwards the areas most likely to be affected are local government, defence, transport, police and justice whereas health and education will probably be quite shielded. It is expected that from 2014-2018 expenditure will be flat, or grow very little in real terms.
To avoid damaging cuts or the traditional 'salami slicing' organisations need to take action now and radically change the way that services are delivered and implemented. Only then will it be possible to maintain and even enhance the volume and quality of public services, while at the same time saving money.
The way forward - what KPMG's public sector specialists propose:
Stage 1: an aggressive and determined programme of cost-cutting with the aim to eliminate costs that do not contribute to the delivery of frontline services
Stage 2: an exercise in determining the relative priority of different policies and programmes, with a view of scaling back or eliminating altogether those activities that are judged to be unaffordable and/or of low priority
Stage 3: redesigning the way in which public services are delivered and the way in which those who deliver services are appointed, trained, incentivised and rewarded
