According to the Guardian, the government faces a multibillion-pound bill to close up to 180 quangos and in some cases it could be a decade before any savings are felt.
The Cabinet Office is poised to publish a list of the organisations facing closure or merger in its "bonfire of the quangos" next week. But private papers reveal that in several cases the liabilities from pensions, redundancies and rental contracts could outweigh any of the savings being claimed for up to 10 years.
The newspaper asserts that there are concerns within the government that quangos are not producing the immediate savings the coalition had hoped for to help obliterate the £153bn deficit by 2015, adding to the intense pressure on the chancellor, George Osborne, to find every penny to meet the target.
This is one of the dilemmas of organisations embarking on change management programmes with particular focus on redundancy.
Leaving aside the other costs associted with shutting quangos, consider these employment issues with shutting quangos or merging them.
1 Redundancy Costs. You have contractual terms to respect(often generous) and redundancy pay to pay out.
2 You have to go through due process including consultation. This takes time and however well you do it is subject to possible legal scrutiny.
3 Existing Management are Caught in a Dilemma. Are they axe wielding warrior managers of they healers of trauma?
4 Most Change Management Programmes fail to focus on survivors. Historically the vast majority of survivors given no guidance or training to deal with a new environment.
5 The Bosses of Downsizing Suffer Stress. According to a dated article in Fortune Magazine called "Burned-Out Bosses" downsizing survivors incur more stress and psycholoical damage than those laid off.
6 Are you optimistic about the future? Most organisations find they do not improve through downsizing efforts. Why should this be different?
Justin Patten, Mediator