The Ministry of Justice is planning a large swathe of job cuts, following an announcement that £2bn of its £9bn budget would be axed.

In a letter to senior staff (Download: MoJ Staff Letter) finance director Ann Beasley said yesterday that “efficiency savings alone” would not be enough to make the 25% cut to the department’s budget that is required by the Treasury.

However, she said £450m would need to be sliced off its headquarters and administration costs, or one third of the ‘back office’ budget.

The immediacy of  the cuts raises questions over the department’s plan to relocate 5,000 civil servants outside Whitehall to a regional hub, which would be costly in the short-term.

The Public and Commercial Services Union is predicting that up to 15,000 jobs could go over the next two years across the courts and prisons service.

Staff have been told that many savings will have to be made within the first two years of the next spending review period, which will be announced on 20 October.

Beasley’s letter says: “Efficiencies alone will not be enough. It will mean we have to look at every opportunity to work differently and better. It will also mean there will have to be less of us. The scale of the savings we will have to make are extremely challenging.”

She also talks of a new “Operating Model for headquarters and administrative functions”, but discloses little detail about this because the department is still negotiating with the Treasury.

One reason why cuts to this department will be so servere is that £4bn of its £9bn budget is reserved to pay for legal aid and prison costs.

The PCS said this could bring the UK’s courts to a standstill. The department is already consulting on plans to close 157 courts across England and Wales.

PCS general secretary Mark Serwotka: “This is the first indication of the true scale of the cuts being imposed upon departments by this coalition government, and it paints a devastating picture.

“It is clear that the civil service will simply not be able to cope. We will take every opportunity to remind the government and the public that there is an alternative and these politically-motivated cuts are entirely avoidable.”

• Justice ministry leads Whitehall retreat
• Ministry of Justice plans to close 157 courts
• Ministry of Justice to vacate Lancaster Castle prison
• Ministry of Justice appoints Knight Frank for two sales
• Council property workers worried about job cuts