The consultant said its hand is being forced by public spending cuts which are not being compensated for by a rapid enough rise in private sector work.

In a trading update today, the firm said: “We continue to see a tightening in the trading environment in the UK public sector, particularly Transportation, which accounts for a significant proportion of our activities in this area.

“Whilst we are seeing a gradual improvement in the UK private sector this will not compensate for the significant decline in the public sector which will impact on our financial performance in the second half.

“We will therefore be taking further restructuring action in the UK over and above that previously anticipated.”

Figures for 2011 are expected to be worse than last year after the restructuring costs hit £4m and bad debts in Libya cost the company £5m.

Chairman David Turner will step down in September to be replaced by Ian Barlow who is a director of the London Development Agency and was previously a senior partner at KPMG.