Making the case for an optimal UK public sector workforce

UK Civil Service is full of talented people who care about the people and societies they serve. To harness this potential, and ensure the right people with the right capabilities are in the right place at the right time, the Civil Service has a People Plan which presents a compelling vision of capable leadership, efficiency, and reformed recruitment. This will ensure the government can successfully manage future challenges in an age of austerity, and approach resourcing with an awareness of the impact of technological automation.

While the intentions are strong, getting your workforce right at a departmental level is a complex, expensive, and time-consuming process. Departments are contending with changes in role requirements, pay inflation, intense competition for talent, and the role that technology such as AI can play in automating and augmenting human teams. This has left many grappling to keep pace.

Workforce costs receive extensive scrutiny

While the upcoming Spending Review offers a chance to reflect on the optimal design of your workforce, HM Treasury (HMT) has already confirmed unprotected departments’ budgets will be challenged to make efficiency savings. Salaries are the largest element of public sector running costs, at £284.5 billion in the latest available Whole of Government Accounts, 2021-22, leading to pressure from Ministers and the public to achieve greater productivity.

This means you must present a compelling rationale for the workforce you need, even if you are only asking to maintain its current size. Based on HMT’s Green Book and business case guidance, combined with our experience of securing people-related investment in the public sector, here are four practical steps you can take to demonstrate this spend is essential, “mission-led”, and offers good value for money:

1. Identify the minimum viable workforce

It’s vital to have a clear departmental workforce plan to inform the strategic case. This should outline the workforce needed to deliver your department’s longer-term purpose, beyond the time horizon of each spending review cycle.

To identify this, work with your HR experts to translate strategic opportunities and challenges, outcome delivery plans, and budgets into the core activities the department must have the capability to deliver. Take a ‘zero-based budgeting’ approach, only re-adding activities that can be evidenced as essential. It can be helpful to prioritise activities from ‘minimum viable’ through to ‘value plus’ which could be delivered if funding becomes available.

When we supported a central government department do this for the 2021 Spending Review, we found it effective to use staff surveys and cross-department focus groups to gain feedback on where the team spent their time and the value of each activity. We then applied a prioritisation framework to evaluate the opportunities this engagement identified, using criteria such as ‘alignment to departmental strategy’, ‘direct impact to customers’ and ‘potential for technology/process enhancement’. Based on this insight the department could more easily identify the proposed changes to ways of working that would realise the greatest efficiencies, reduce the biggest burdens on staff, and ultimately help them to become more outcome focused.

2. Consider multiple workforce options

To give confidence the right approach has been identified, show a wide range of options have been explored around the size, shape, and capability of workforce required, in line with the business case guidance’s framework filter approach.

There are two key lenses to consider. Firstly, explore options around the workforce capability you need to deliver your essential activities, and consider whether you could exploit automation and digital solutions to reduce the people element of tasks. Options could range from business as usual (BAU) ways of working to process simplification, and onto more involved technology-led transformations.

Secondly, assess options for how best to gain the necessary workforce capability. This time the spectrum is focused on ‘internal to external’ sources, from greater cross-department collaboration and sharing of capability; to boosting existing workforce capability with retraining and redeployment; through to securing new permanent staff through controlled recruitment or outsourcing the requirement.

Evaluating the trade-offs for each of these options will give you a robust evidence base to stand up to scrutiny.

3. Demonstrate the return

Given the pressure on decision-makers to realise efficiency savings, break down the payback achieved from investing in an optimal workforce.

Workforce investments typically lead to increased effectiveness and productivity, avoid downstream costs, and lower turnover and recruitment costs within the first year. These initial gains can, over time, lead to significant cost and time savings from new capabilities that enable delivery of greater value and reduce reliance on outsourced support. Drawing on historical data from wider government will help to ground estimates in evidence.

For example, the Department for Work and Pensions invested £230 million to increase the size of their Universal Credit Targeted Case Reviews team to approximately 6,000 staff. This will enable them to review millions more claims and is expected to save £6.6 billion in fraud and error by 2027/28.

Equally, ensure all transformation costs, including training, service disruptions, and displacement of service demand elsewhere in government, are accurately accounted for. Many projects underestimate these, only to later encounter significant unbudgeted costs.

4. Estimate the cost of inaction

Not all workforce changes will have a compelling cash-releasing ROI, especially where employees are moved to other value-adding activities rather than seeing their numbers reduced.

In these cases, focus on the value unlocked by the right workforce. As part of this, recognise the gap between BAU and the desired target state will grow over time as people leave and outdated skills increasingly hamper progress.

Aggregate examples from across the department to evidence the value at risk if the workforce is not optimised. A benefit-cost ratio can then be estimated that demonstrates the value for money of the preferred workforce option. For example, the Police Uplift Programme estimates £23 billion in benefits can be achieved from recruiting 20,000 more police officers to prevent 500,000 additional crimes – provided that retention levels also improve to ensure long-term impact.

Adopting the above steps will create a compelling narrative – underpinned by strategic intentions and robust data – to help you secure funding for a more efficient and effective workforce.