Flexible workers, such as IT contractors, will play a vital role in the success or failure of the public sector overhaul, it is claimed.

Job agencies in Northern Ireland are already feeling the strain of the public expenditure squeeze, while 20,000 public sector workers in the area are set to lose their job, according to the region's branch of the Recruitment & Employment Confederation (REC).

While temporary staff were always going to be the first victims of the public spending cuts, REC regional director for Northern Ireland Jim Beresford, is insistent that they should not be forgotten about altogether.

"We are continuing to fight our corner and to argue that flexible staffing should be valued and used effectively, rather than simply slashed as a knee-jerk reaction to the expenditure squeeze," he said.

Peter Reilly, director of HR research and consultancy at the Institute for Employment Studies, recently suggested that many public sector workers will see redundancy as an opportunity to start their own business.