The Crown Prosecution Service has too many in-house lawyers as it continues to face the challenges of budget cuts, according to the annual report of the agency’s inspectorate.

Her Majesty’s CPS Inspectorate said a lack of resources due to budget cuts is hampering the service’s ability to prepare cases, but observed that the CPS has ‘more Crown advocates than it requires for its business need’.

This makes it ‘extremely difficult’ to generate savings.

Overall, the number of staff employed by the CPS fell in 2012-13, from 7,087 to 6,816.

The report found that the quality of prosecutors’ decision-making is improving, but said more needed to be done to ensure cases go through court more quickly and efficiently.

HM chief inspector Michael Fuller said: ‘The CPS continues to face major challenges to the efficient and effective delivery of its service.’

He said that ‘significant changes’ are planned, including to the size of the estate, and predicted that the CPS will ‘look very different by the end of the next business year’.

A CPS spokesman said: ‘We have had to make savings of 27% to our budget, but we are achieving this while both protecting frontline teams and improving performance.’

He was pleased that the inspectorate found that the quality of charging decisions continues to improve and compliance with the Code for Crown Prosecutors is now at 93.5% for all cases, higher than last year.

Overall, he said, conviction rates have remained consistent at 85% or above for the past eight years. The conviction rate for violence against women and girls, including rape, hit a record high in 2012/13.