Whitehall is focused on delivering considerable efficiency savings, but has lost sight of its stated aim of becoming one of the top-performing administrations in the world by 2012, leading advisers have warned.

Public sector specialists at Deloitte believe senior staff must redesign Whitehall, if they are to achieve top performance, while simultaneously slashing billions of pounds off the cost of running the civil service and local government.

A report by Deloitte, published on 11 December, says departmental reconfigurations are required if the Government's planned cull of civil service numbers and budgets is not to leave some organisations asking staff to do too much, with too little.

Deloitte is the latest organisation to warn ministers against tightening the public sector's purse strings without thinking through whether cuts leave organisations well placed to deliver crucial services.

Keith Leslie, Deloitte partner and author of the report, said: ‘Too often, organisations focus on reducing their size, assuming that if staff numbers are cut, everything else will take care of itself. The result will be a public sector locked into a spiral of decline for years to come. A more proactive approach is required which acknowledges shape is equally important.'

Mr Leslie believes managers must address three questions: