Cabinet proposes cuts to civil service redundancy payments

26 Sep 17

The government is pushing for less generous civil servant exit packages than those found to be unlawful by a judicial review. 

Civil servants could see their voluntary exit and voluntary redundancy pay outs capped at 15 months’ salary, a consultation document on the proposed changes to the Civil Service Compensation Scheme released yesterday revealed.

This is less than the 18 months’ salary cap – for both categories - that was introduced on 9 November last year.

Although, this was then reversed when it was found to be unlawful by a judicial review held in July this year.  

FDA assistant general Naomi Cooke noted: "This new consultation proposes worse terms than those negotiated by the FDA and seven other unions last year, and removes a series of hard-won protections."

She called it a "a major backwards step".

A series of concessions won in the final round of negotiations for the changes last year had now been lost, she added.

Although the proposals last year were agreed by eight out of 10 unions, they were not endorsed by the Commercial Service Union and Prison Officers Association.

The high court ruled although the changes to the redundancy scheme would “make a material contribution to reducing the budget deficit” the government had not met with its statutory obligation to consult. This was because the PCS union was excluded from those negotiations.

The decision meant the more generous 2010 CSCS rules applied, which set voluntary exit and voluntary redundancy scheme pay at 21 months.

A spokesperson for the PCS said the union was "disappointed" by the Cabinet's actions and that it was "rushing into a further short consultation period".

The union would oppose "detrimental changes to redundancy pay" through "any available route".  

But Garry Graham, deputy general secretary of Prospect union, was critical of the PCS.

"Prospect warned that the judicial review taken by PCS provided the excuse and opportunity the government wanted to table worse terms than were ultimately negotiated and signed up to by eight unions ... in 2016."

Unions FDA, Prospect, GMB, Unison, Unite, NCOA, the Defense Police Federation and PGA agreed the 2016 CSCS changes. 

The consultation document noted: "The court did not doubt that the government had good reasons for seeking to reform the 2010 CSCS terms.

"The judgment was clear that changes to the CSCS would make a material contribution to reducing the budget deficit, particularly as the 2010 scheme had not realised the expected level of savings."

Instead of appealing the court's decision - which was the Cabinet's original intention - it has withdrawn that appeal, instead opting to consult unions over the next six weeks on these latest proposals. 

The government expects the new proposals to cut the costs of the scheme by a third from what it costs under the 2010 terms.

A cabinet office spokesperson said: "The government is resolved to introduce sustainable compensation terms that strike a fair balance between the need to provide a good level of redundancy payments to individuals and fairness to the taxpayer that ultimately funds such exit payments."

Interested parties have until 6 November 2017 to respond to the consultation.

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