Labour has been accused of presiding over “chaos” and wasting taxpayers’ money after figures revealed that the Cabinet Office paid off 383 staff while recruiting 627 others in the 2025-26 financial year.
The department, traditionally regarded as Whitehall’s “engine room”, is facing demands to disclose the full cost of its voluntary exit programme and explain why hundreds of new appointments were made alongside the departures.
The figures, uncovered by the Conservatives, cover employees leaving through voluntary exit and new appointments to the Cabinet Office’s core department. They exclude recruits to the Fast Stream graduate programme and staff joining arm’s-length bodies, meaning the figures do not represent the full movement of personnel across the wider organisation.
Mike Wood, the shadow Cabinet Office minister, accused ministers of failing to demonstrate value for money.
“Labour needs to explain why on earth it is paying off 383 civil servants while hiring 627 more. What a waste of taxpayers’ money,” he said.
“The Conservatives have been very clear that we would cut the civil service back to 2016 levels. Labour Ministers would do well to take a leaf out of our book. Labour must come clean on the cost of these payouts and explain why taxpayers are footing the bill for this chaos.”
The Conservatives have pledged to reduce the civil service by 132,000 posts, claiming the move would save £8bn. The proposal places the size and cost of the state at the centre of the party’s challenge to Labour’s management of the public finances.
William Yarwood, of the TaxPayers’ Alliance, also criticised the department’s approach, arguing that paying severance to hundreds of employees while recruiting hundreds more risked undermining public confidence in Whitehall’s spending decisions.
“Taxpayers will be furious to see their money being wasted on a bureaucratic revolving door in Whitehall,” he said.
“Handing out massive severance payouts to hundreds of civil servants while simultaneously hiring hundreds more is an appalling waste of taxpayers’ hard-earned cash.”
Yarwood called on ministers to freeze recruitment and reduce the size of the civil service.
The Cabinet Office rejected the suggestion that the figures demonstrated waste, insisting that its restructuring was designed to meet changing demands while reducing overall staffing.
“We are reshaping for the future,” a spokesperson said. “While our latest annual report shows total headcount decreased by 22% [full-time equivalent posts], a strategic shift in hiring ensures we are built to tackle today’s challenges and fulfil the Government’s priorities.”
The department also pointed to a Treasury report showing that it delivered £123mn in efficiencies and savings during 2025-26. It said that, in the year to March, its workforce had fallen by 1,470 full-time equivalent positions.
The dispute highlights the difficulty of assessing public-sector restructuring through recruitment and departure figures alone. Voluntary exits and new appointments can reflect changes in the skills a department needs, while severance payments may generate upfront costs in pursuit of longer-term savings.
But without a breakdown of the payouts, the roles recruited and the financial impact of the restructuring, the figures leave an important question unanswered: whether the Cabinet Office’s workforce changes are delivering better value for money.
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