By Tash Shifrin
25 March 2010Chancellor Alistair Darling announced a shift of Whitehall jobs out of London and restated his desire to crack down on pay and pensions.
The chancellor crossed the picket lines of civil servants staging their first ever Budget day strike to deliver his speech. Around 200,000 members of the Public and Commercial Services union were striking in a dispute over cuts to their redundancy terms.
In his Budget, Darling promised savings of £4.4bn in public sector pay and pensions by 2012/13, saying: ‘Public pay settlements will be held at a maximum of 1% for the two years from 2011. We will also implement reforms to ensure public pensions are affordable.’
He also endorsed the report by Ian Smith, former chief executive of publishing giant Reed Elsevier, calling for 15,000 civil service jobs to be transferred out of London in the next five years.
Smith’s review said civil service jobs in the capital should eventually be reduced by ‘at least’ a third from the current 85,000. His report noted: ‘London has 16% of civil servants, but the estate costs of £600m per annum are a quarter of the national total.’
Darling said moving 1,000 posts from the Ministry of Justice would save £41m.
Smith emphasised the need for ‘directive’ leadership to ensure the ‘London magnet effect’ was broken. He recommended a cap on the civil estate in London, to be ‘managed down over time’ as break-clauses in leases came up.
But Smith rejected moves to relocate workers from elsewhere in the Southeast, saying the evidence of financial benefits was ‘much weaker’.
PCS union leader Mark Serwotka said: ‘Today’s Budget of so-called efficiency savings, makes it clear that the reason the government is ripping up the contracts of loyal civil servants is to make it easier and cheaper for whoever wins the election to cut them.
‘The government needs to recognise that they can’t force civil servants out of a job if they are unable to relocate. Relocation needs to be done with the consent of the workforce, not forced through, and with proper equality impact assessments carried out.’
The union’s executive was set to discuss further strikes at a meeting on March 25. A judicial review of redundancy payment cuts will begin on April 22.
Jonathan Baume, general secretary of the First Division Association, noted the lack of consultation with staff.
He added: ‘It is hard to see how this can be carried out given the reluctance of civil servants at all levels to leave London.
‘Furthermore, the vast majority of civil servants employed in London work in local networks or support London-based ministers.’
