A public-private debt problem

Those in debt and working in the public sector could have a deeper set of problems than they imagine, a new survey has indicated.

While the governm…

Those in debt and working in the public sector could have a deeper set of problems than they imagine, a new survey has indicated.

While the government hopes the private sector will expand and the public sector be reduced in scope, the problem of re-employment may be a significant one for many of those who will be leaving the public sector – either voluntarily or by obligation – and seeking new roles in private firms.

For such people, the results of a survey by uSwitch of small and medium enterprises (SMEs) will make uncomfortable reading.

It found that while 22 per cent of SMEs are looking to hire workers this year, only two per cent are aiming to do so from the public sector and a reason for this the poll identified is the low regard public sector staff are held in among bosses of commercial enterprises.

For instance, 55 per cent of managers thought new employees coming from the public sector would have unrealistically high expectations of pay and holidays, while just 11 per cent believed those emerging from state-funded roles would be as efficient as their private sector counterparts.

The upshot may be a worrying one – that debt management plans and individual voluntary arrangements (IVAs) may be needed by those leaving public sector jobs in debt because the attitude of the private sector could undermine their ability to compete in the jobs market.

In a speech yesterday (April 7th) to the British Chambers of Commerce annual conference, chancellor George Osborne said many regions have “too big a public sector and too small a private sector” and need re-balancing.

But the findings of the poll may suggest this process could leave some out of work and in very deep debt.

By Joe White

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