Unlock the publisher’s digest free
Roula Khalaf, editor -in -chief of the FT, selects her favorite stories in this weekly newsletter.
Government services responsible for attracting domestic investments in the United Kingdom and promoting British exports are faced with significant job cuts in the context of future expenses, the initiates of Whitehall warned.
The proposed staff discounts arise despite the repeated promises of the Chancellor and the Prime Minister to attract more investors in the United Kingdom and stimulate economic growth.
A person who knows the discussions said that the staff of the business and trade department had been warned of the “30 to 40%” workforce reductions, under proposals aimed at merge two units involved in the promotion of the kingdom -Uni as an investment destination.
A second person said there were plans for a “brutal haircut” to export promotion teams in examining “zero” expenses, where the departments must start with a virgin leaf and justify their levels of Endowment.
The Department of Affairs and Commerce said that it “had not recognized” the speculation of 30 to 40%, adding that no final decision had been made on the workforce.
However, officials admitted that the examination, which ends in the spring, imposed difficult decisions for all the departments of Whitehall.
A third person familiar with the process said that unions had raised concerns about restructuring. The union of public and commercial services, which represents more than 190,000 civil servants, refused to comment.
Officials said that the reductions in inward investment personnel occur in tandem with a merger between the investment office of 25 people – a joint treasury organization, number 10 and the business department created in 2020 – and the much larger interior investment promotion management at DBT.
Sir Keir Starmer promised last October to “strengthen” and “redo” the OFS alongside the appointment From the Baroness Poppy Gustafsson, co-founder and general manager of the Cybersecurity Society Darktrace, as Minister of Investment.
A person familiar with the restructuring said that the ministers planned to transform the OFF, which had previously operated as a small team of “fixers” cross-departs, in the main agency to promote the investment.
The proposals follow the recommendations of Lord Richard Harrington in his 2023 examination of the British investment landscape, in which he declared that the OFS needed to “receive stronger support from the central government” as part of a new commercial investment strategy.
Its reinforced role will also include the strengthening of links with regional mayors, using combined authorities to help write local investment proposals to attract investors.
Tom Pope, deputy chief economist of the reflection group on the Institute of Government, said that there was a strong economic logic behind a greater use of the authorities combined by the mayors to attract the IED.
But, he added, there was currently a “capacity gap” in staff and expertise to MCAS to deliver the ambition.
However, two initiates declared that despite its reinforced role, the merger of OF of the investment department of the business department would always lead to a clear reduction in the workforce.
“We were told that this would mean a reduced overall capacity and no expansion of staff or services,” said the director of a British regional trade promotion body.
The changes to the investment department were announced to the staff during a call “all hands” earlier this month, with a request for “haircut up to 40%” in the overall figures of the Endowment, according to a report of internal discussions.
Jordan Cummins, the head of the CBI competitiveness department in the United Kingdom, said the challenge was to strengthen the OFF while carrying out workforce reductions within the department, which were expected as part of the examination of expenses.
“Deckchair Shuffling in the framework of the expenses are only the first step. The second step makes this new body more sensitive to investors, useful for mayors and transparent for companies. It starts with the Minister of Investments who exposed a vision of what she wants to achieve, ”they added.
The trade performance of the United Kingdom is low from Brexit compared to other G7 countries, British trade as part of the GDP now of 3.5% lower national statistics.
The British Chambers of Commerce have declared that it sought to deepen the partnership with the business department in order to improve export and commerce promotions, citing studies Showing government support to trade has led companies more likely to export and survive recessions.
William Bain, head of trade policy at the BCC, said that the group would be worried by cuts to export promotion activities. “It’s time, if you want to increase growth and consider reversing recent commercial losses, to make a targeted investment in export promotion,” he added.
The business department said that stimulating trade and investment had an essential role in the supply of the government’s economic growth mission and that the ministry would continue to support British companies to export and attract investments .
“We create a new investment promotion agency, which will be more rationalized and well qualified, to provide better service to our key investors and guarantee the investment that our economy needs to stimulate jobs and growth,” -It added.
