Rachel Reeves announced in her Spring Statement that the Government’s new "transformation fund" will introduce “voluntary exit schemes to reduce the size of the civil service”. It comes as the Chancellor confirmed on Sunday that she aims to reduce government spending by 15%, cutting 10,000 jobs. The tech billionaire Elon Musk is in charge of the Department of Government Efficiency (DOGE) in the United States, with an aim to cut government expenditure. In January, Donald Trump's administration reportedly offered more than two million federal workers voluntary redundancy, including eight months' pay.

Now the Chancellor has told UK MPs that she is rolling out her own opt-in scheme to reduce bureaucracy and ensure the state is more efficient. She said this afternoon that ministers are "bringing forward £3.25billion of investment to deliver the reforms that our public services need". Ms Reeves added: “That is money brought forward now to bring down the costs of running Government by the end of the forecast period by making public services more efficient and more productive.

“I can confirm today the first allocations from this fund include funding for voluntary exit schemes to reduce the size of the Civil Service, pioneering AI tools to modernise the state, investment in technology for the Ministry of Justice to deliver probation services more effectively, and up-front investment to support children in foster care to give them the best start in life and reduce cost pressures in the future.

“Our work to make Government leaner, more productive and more efficient will help deliver a further £3.5billion of day-to-day savings by 2029-30.”

The Chancellor also mentioned the Prime Minister's announcement that NHS England will be abolished to "ensure that money goes directly to improving the experience for patients".

She added: “The Health Secretary is driving forward vital reforms to increase NHS productivity, bearing down on costly agency spend to save money we can improve patient care.

"And the Chancellor of the Duchy of Lancaster is taking forward work to significantly reduce the costs of running government by 15%, worth £2billion, by the end of the decade.

“This work shows that we can make our state leaner, and more agile, delivering more resources to the front line while ensuring we control day-to-day spending to meet our fiscal rules."