LONDON EDITOR

The full extent of the region's exposure to public sector spending cuts has been laid bare as figures revealed one in five workers in the South West are employed by the state.

The Office for National Statistics (ONS) yesterday published its most comprehensive report on the region's reliance on the state for jobs and pay.

In South West, 21.2 per cent of the workforce are employed at councils, military bases, hospitals and many other arms of the public sector.

It means the region relies on state-funded jobs to a greater extent than any other region in the south of England.

The report also shows that the number of public sector workers employed in the South West increased by 5,000, or about one per cent, in the past year – exposing the region even further to cuts.

MPs and business leaders last night said while there was "pain to come", the figures showed how the Westcountry had to "wean itself off" jobs underwritten by the state.

Tim Jones, chairman of the Devon and Cornwall Business Council, said the public sector in the region has become too inefficient in recent years.

He said: "The number of pen pushers and civil servants monitoring process has discouraged business investment. There's no investor appetite."

George Eustice, Conservative MP for Camborne and Redruth, said: "This is the reason why the Government created the regional growth fund — to try to wean areas off their dependence on the public sector, to promote entrepreneurialship and drive private sector job growth."

The figures come hard on the heels of a report warning that civil servants in the South West could bear the brunt of the cull of public sector staff.

Council staff and lower-paid workers outside London are set to shoulder the majority of the redundancies, with their Whitehall counterparts expected to hold on to their jobs, it is said.

The growth in public sector employment has largely been driven by the NHS, the ONS report showed.

Some 133,000 people were employed in the health service in the South West in the first three months of this year, a sharp 4.7 per cent rise on last year.

The Department for Health is one of just four departments to be offered protection from deep public spending cuts, but a radical overhaul of the structure of the NHS could mean job losses.

Next month, Chancellor George Osborne will announce details of the spending review that could see departments have their budgets reduced by 40 per cent.

The ONS report revealed around 122,000 people are employed in education in the South West, an area not offered full protection from cuts.

The figure is 4,000 fewer than the same time last year — suggesting jobs are already being shed.

Local authorities also witnessed a slight fall in jobs in the region.

A study by South West Stakeholders, an alliance of social and economic organisations, has just concluded that the region is in danger of becoming "the forgotten part of England".

The report says some parts of the South West are more vulnerable to the reductions in public spending because they rely more on public services or are heavily dependent upon defence.