Yes and no, re the NHS, creamsoda, I work in the NHS.
At the moment there are hundreds of us whose jobs are at risk of redundancy due to the cutbacks and redesigns, so those people go into the redeployment pool. If I advertise a vacancy in my team (and it's very hard at the moment to get permission to fill a vacant post if someone leaves), then HR have to consider whether there is anyone with suitable experience and qualifications in the redeployment pool, and if there is, they are given a trial in the job, to see if they can switch rather than have to leave. If it doesn't work then we would look outside, but currently every effort is being made to redeploy people into any new vacancies, rather than make them redundant.
It doesn't mean that jobs are advertised internally for all to apply for - you can only apply if you are in redeployment, the vacancies (such as they are) are only open to everyone once the job's gone public on NHS Jobs.