As for the private sector pain, public sector pleasure argument that the media is full of, in the Government Department I work in was subject to an imposed three year pay deal which was worth 2% per year. That is the cost of all increases across the organisation. That deal meant 2%/1%/0% over the last three years for a lot of staff. Inflation was 5% in the first of those years, and 3% in the latest year. The money freed up from the 2% a year was then used to boost the pay of the very lowest paid.
Of course there is waste in the public sector, just as there is waste in the private sector - my new mobile phone company has had to spend £100s in the last few days in providing support because their salesman was so incompetent and sold me a phone/sim combination that was incompatible.
But waste elimination doesn’t mean you save money in the public sector because the public sector doesn’t make and sell widgets. In the private sector, things are simple. There is a market for 100 widgets, halve the cost of making 100 widgets and you make more profit. If you sack a load of people in the process, don’t worry, the tax payer will pick up the financial costs, and society will pick up the social costs, but the shareholders will be better off.
In the public sector reducing waste doesn’t always mean you save money (it can mean more cost). For example, say you have a load of doctors and nurses who are giving people hip replacements. They are not very efficient and only do 50 in a year. Say you eliminate a load of sick leave, and make them work harder and better. Now they can do 100 hip replacements. You have not saved a penny by eliminating waste (indeed, now they are doing more operations it may cost you more in support services, theatre time, hospital beds, etc). You could instead sack half the doctors and nurses, which would save you a load of doctors’ and nurses’ salaries, but you would still only be doing 50 hip replacements and those people who can’t get around due to dodgy hips don’t come cheap.
Those extra hip replacements mean more people will be able to work, there will be reduced benefit costs, and fewer people will fall and injure themselves further and fewer people will be giving up work to be carers and so weakening the labourforce. But none of this will appear in the balance sheet of the hospital departmental who has been more efficient. You have made the system more efficient, but the bean counters will not be able to see a single bean in the bottom line that has been saved.
So of course you want to eliminate waste by making those workers do 100 hip replacements instead of 50, but you don’t save any money that can be claimed as savings unless you sack people. If you sack people you are now doing fewer hip replacements meaning more people who can’t work, higher benefit costs, more people leaving productive jobs paying tax to be informal carers on benefits etc.
Talking about waste is just politicians being lazy and not talking about what they will really cut.
