New YouGov research commissioned by Interserve reveals that many leaders across local government and the healthcare sector expect reductions in available funding and the quality and range of frontline services. A majority also believe outsourcing will be important to maintaining services in this challenging economic climate.
Almost three-quarters (74%) of senior decision makers across healthcare and local authorities expect their budgets to decrease, with over four in ten (42%) anticipating funding cuts of 11% or more by 2016. Of those expecting budget reductions, 38% think they will lead to the outright removal of certain frontline services.
In the health sector, a significant majority (76%) of those facing cuts believe changes in funding, such as budgetary cuts and the increasingly complex fiscal structures, will have a negative impact on the delivery of services. However, over a third (34%) believe they will not have achieved their budgetary targets by 2016.
Effects on workers
Meanwhile, more than a quarter (27%) of health and local government leaders expect headcount reductions of greater than 11% by 2016 and nearly two-thirds (65%) anticipate a fall in available funding for training and skills development.
Importance of outsourcing recognised
While more than a third (34%) of leaders across healthcare and local authority say that a strategy for dealing with budget cuts is yet to be developed, over half (58%) think that outsourcing to the private sector will be at least slightly important in meeting budgets and maintaining service levels.
However, public sector decision makers say there are significant barriers to outsourcing, such as a lack of trust (31%) and political concerns (38%).
Adrian Ringrose, Chief Executive of Interserve commented: “Budget cuts, which in previous years have focused on back office services, are now anticipated to affect more and more frontline services, and that affect will be noticeable. In the face of budgetary constraints, we believe there are alternatives to cutting services, and outsourcing can help… Outsourcing can benefit communities through business investing in skills development and sustainability initiatives that the public sector is currently unable to fund. For instance, through the inclusion of apprenticeships and local supply chain targets in government contracts, public services can have a wider positive social impact.”
Interserve is a support services and construction company, operating in the public and private sectors in the UK and internationally.
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