A CULL of Civil Service jobs was proposed by both the Government and the Tories yesterday as Whitehall reform moved to the top of the general election agenda.

Both sides believe that they can pour more money into health and education by streamlining the service and ending its job-for-life culture.

The future of Britain’s 516,000 civil servants will form a key election battleground after a leaked government review disclosed plans to overthrow the powerful fiefdoms within Whitehall.

The review would save £15 billion by cutting 80,000 backroom jobs and deploying staff to frontline public service posts outside London.

Tony Blair will give a warning of a dramatic change in the way Whitehall operates in a major speech on the future of the Civil Service next week, the Times has learnt.

The leaked report by Sir Peter Gershon, head of the Government’s efficiency review, outlines plans to transform the Civil Service into a small, streamlined administrative core which delegates most of its powers to super agencies at regional or national level. The “generalist” civil servant, long considered a strength of the system, would be increasingly replaced by highly-skilled specialists.

The Conservatives attempted to trump the Government, saying that their own review of “unnecessary spending” would find several billion more in savings. David James, the Government’s troubleshooter on the Millennium Dome, is conducting the Tory review. It would start with a freeze on all new civil servant appointments, and a cull of backroom staff.

Few in Whitehall doubt the determination of both sides to clamp down on the soaring costs of Whitehall.

Gordon Brown, the Chancellor, sees this sort of cost-cutting as crucial if he is to maintain spending levels without resorting to more tax rises.

For the Conservatives saving money by cutting red tape is essential if their plans to reduce the national budget overall, while increasing spending on health and education, are to remain credible.

Yesterday Oliver Letwin, the Shadow Chancellor, outlined his vision of reducing public spending by £35 billion a year by 2011. His ultimate goal is to be able to cut taxes.

To allay public fears, he has had to promise not to make savage inroads into key services. Indeed, yesterday he promised to maintain pensions and benefits at their current levels, and pledged billions of pounds in extra spending for schools and hospitals, although he coupled this with plans to increase competition, making schools compete for pupils and hospitals for patients.

The savings needed for this will largely come from a purge on Whitehall bureaucracy. In addition, Mr Letwin said he would impose a two-year freeze on the budgets of the Home Office and the Ministry of Defence.

Labour said that its calculations showed that if the Tories were to meet their spending pledges, they would have to find £18 billion of cuts in the first two years and more in the years afterwards. But Mr Letwin said reports that Sir Peter had identified £15 billion in saving in Whitehall showed that his plans were credible.

However, last night an ICM poll commissioned by BBC Two’s Newsnight programme dealt a blow to the Tories’ proposals. The poll asked people what they would think if the Conservatives said they wanted to reduce taxes, but also spend more on health and education by cutting public spending in areas such as transport, roads, defence and local council funding. Some 55 per cent of people disapproved, including 22 per cent who disapproved strongly, with just 39 per cent supporting the idea.

Over the past few decades the Civil Service has built up more than 20 mammoth Whitehall departments. The number of civil servants has risen in recent years despite Labour claims that it is decentralising services. Most departments have their own sections for purchasing, human resources, information technology, communication and other services. Very little information is shared between departments. Ministers make the problem worse by vying with their colleagues for more power, more money and more press coverage. In addition, successive governments have built up a plethora of arm’s-length agencies and regulatory bodies to oversee public services.

In his interim report, leaked yesterday, Sir Peter, a former BAE Systems executive, claims that he can save the £15 billion by merging many of these functions into a handful of super agencies that would handle these services across Whitehall and the 400 local authorities. The number of agencies and monitoring bodies would also be streamlined.

Some of the 80,000 civil servants would be able to move to new jobs after retraining, but others would be made redundant. Thousands of jobs would be frozen to limit compulsory redundancies.

The leaked proposals coincided with a 48-hour strike by 100,000 civil servants.

Mark Serwotka, general secretary of the Public and Commercial Services Union, said: “This is as an extraordinary attack on the Civil Service. Any job losses on this scale are completely unacceptable.”

Explore UK News

• Crime News

• Education News

• Health News

• Scotland News

Times Recommends

• In Margot Fonteyn's footsteps
• Forget beautiful people, let's have wonky Brits
• Fundamentalist brew: faith and power