Yet again a politician tries to ruin Britain's economy for ideological reasons
I'm guessing that the real reason for this is part of the continuing assault on the use of contract staff in government departments. Government cannot attract skilled staff and cannot retain the few permanent staff who have or attain skills that match the level available in the contract market. This proposal would lead, inevitably, to lots of former contractors on the dole or escaping to other countries.
The government can't increase its headcount and commercial clients will not want to increase their payroll hence both will attempt to muddle through as best they can. The medium to long term result will be a loss of skills and the UK will become uncompetetive in the IT sector and some other specialist areas, such as some aspects of civil engineering, where particular skills are needed for periods of less than a year but longer than a month.
For both government departments and companies there is no point to employing someone on a permanent basis for short term work. I suspect also that the unscrupulous companies will increase their exploitation of permanent staff. I'm aware that some companies offer "permanent" work and then terminate the employees with one week's notice during the two year probationary period.
Biting the hand that feeds IT
