Recommendations contained within the report suggests that UK public sector companies need to go through a raft of radical changes to successfully redefine their role.
“At the moment there is a lot of focus on short-term measures to tackle the budget deficit such as cutting costs and delaying major projects. But we must start to consider the long-term effects of the economic downturn on the public sector,” commented Alan Downey, head of public sector at KPMG.
Cost reduction, improving efficiency and finding new sources of funding were among some of the suggested changes, while improving financial management and involving the private sector in funding the delivery of public services was also needed.
Downey said that the public sector was not in need of the same immediate attention as that of the private sector but a long-term strategy was needed for fundamental change.
The report found that the UK public sector was slower than other countries to initiate crucial changes.