The government's Department for Culture, Media and Sport is facing job losses of up to 50 per cent, following a proposal to the treasury by culture secretary Jeremy Hunt.
Hunt intends to scale back the 590-strong workforce by 35 to 50 percent, according to The Guardian, and will himself move into a smaller office to lead by example.
While it is too soon to predict the long-term effects on government financial support for culture and arts, such deep cuts to what is already one of its smallest, least-funded (at £2.1 billion) departments are unlikely to bode well for ongoing efforts to secure incentives for the games industry.
The government has stated it will setup Local Enterprise Partnerships to replace the regional development agencies scrapped as part of last month's budget. Their exact nature has remained somewhat mysterious, and the planned DCMS cuts may complicate matters further.