The government has dropped plans launched by the Conservative government in 2022 to reduce redundancy terms for civil servants.
Civil service union PCS said the Cabinet Office had told the union in a meeting that it has brought an end to the consultation on changes to the Civil Service Compensation Scheme, which set out to worsen the terms established in 2010.
The Cabinet Office confirmed to CSW that it has brought the consultation to an end to help bring clarity and enable departments to move forward with exit planning.
Under the proposed changes, civil servants who took up their employers’ offers of voluntary redundancy would have been entitled to only three weeks’ pay per year, up to an 18-month cap. Those forced to take compulsory redundancy would have their severance packages capped at nine months’ salary.
This compared to the status quo of a month's salary per year, up to 21 months for VR and up to 12 months for compulsory redundancy.
The 2022 consultation was the latest in a series of attempts by Conservative governments to reduce the CSCS.
In 2016, the government imposed cuts to civil servants’ redundancy terms that would have amounted to members receiving one-third less than their entitlement on redundancy.
PCS challenged the changes in the High Court via a judicial review. The High Court agreed with the union’s case that the changes had been made unlawfully and quashed them. The previous terms have remained in place since, which PCS says has “put an estimated £1bn in members pockets”.
A consultation seeking again to limit the redundancy package followed in 2017, and the Conservatives made cuts to the CSCS a manifesto commitment for the 2019 general election. It launched a further consultation scheme in 2022. In 2023, however, the government agreed to not make any changes to the CSCS in the lifetime of that parliament.
PCS said the Cabinet Office had confirmed at a meeting on 3 April that it would end the consultation on the CSCS. Martin Kavanagh, PCS’s national president, called the move “significant victory” for the union and “testimony to the fantastic campaign” it had run.
The union said it had also discussed the planned 15% cut to the civil service’s administrative budget of the civil service with the Cabinet Office. It said the department had confirmed it is not pursuing an arbitrary number of job cuts and that the savings departments are being asked to make include “consultancy spend and accommodation running costs”.
PCS said previous governments “have sought to cut our members' redundancy terms in advance of significant job cuts programmes in the civil service in order to get them done on the cheap”. It said the “assurances given by the Cabinet Office on jobs, coupled with the end of the attack on the CSCS terms, may indicate a change of approach by the new government”.
At the Spring Statement last month, Rachel Reeves made £150m available for government employee exit schemes in 2025-26 through a new transformation fund
A government spokesperson said: "We are committed to creating a more agile, effective and active state, focused on delivering the Plan for Change.
"A new fund for exit schemes will enable departments to reduce staffing numbers over the next two years and create significant savings on staff employment costs."