We need a better discussion about public sector pay

The public sector pay debate is often reduced to simplistic arguments of “too much” or “too little”. Transparency and accountability are needed to restore trust
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By Emma Thwaites

01 Oct 2024

The debate over pay for public officials has surfaced again, this time focusing on the prime minister’s chief of staff, Sue Gray. However, the issue is much broader than one individual’s specific remuneration, and aside from the nuances of this particular story, it's not the first time we have been here. Indeed, there is an important discussion to be had about the salaries of senior politicians, special advisers, and senior civil servants in the UK today.

As a former senior civil servant working in the Cabinet Office in 2010 during the transition from Labour to the Conservative/Lib Dem Coalition government, I vividly recall similar comparisons being made. David Cameron’s pay as prime minister was often compared to the wages of top senior civil servants, many of whom earned more than his £142,500 salary. 

This led to reforms. Mandatory salary transparency for anyone earning more than £150,000 was introduced, and independent bodies like the Senior Salaries Review Body became more involved in advising on pay for senior public servants to strike a balance between competitiveness and accountability.

Fast forward and there are echoes of that debate today. Even though comparing the pay of senior civil servants with that of politicians and spads is tempting, their roles are fundamentally different. Civil servants are career professionals who remain politically neutral, while spads work directly in the political sphere, offering partisan advice. Their jobs are often tied to election outcomes, making their roles more uncertain.

Senior civil servants earn high salaries when compared to the national average, but these aren’t excessive when matched against private sector equivalents. Only 0.5% of civil servants earn more than £100,000. The average salary of senior civil servants is £88,970, which, while above the national median, is significantly lower than comparable private sector roles.

In recent years, one of the key challenges has been maintaining competitive pay in the civil service. Strict salary bands and slow progression make it easy for talented individuals to be lured away by better-paying opportunities. 

Turning to the prime minister’s pay, the official salary is listed at £172,153. However, the current prime minister claims only £75,440 of the £80,807 allocated for the role (the remainder comes from his job as an MP), making the total £166,786. Yet it must not be forgotten that beyond this, the PM enjoys numerous benefits, including residences at Downing Street and Chequers, utilities, transport and staff. These perks add significant value to the role.

Former prime ministers also benefit financially after leaving office, with the ability to claim up to £115,000 annually under the Public Duty Costs Allowance. In the year ending March 2023, six former prime ministers claimed a combined total of £617,667 under this scheme.

MPs earn a basic salary of £91,346, which is more than double the UK median wage. However, compared to the private sector, this figure seems modest given the responsibilities involved. The expenses scandal cast a long shadow over MPs' pay, leading to the creation of the Independent Parliamentary Standards Authority, which oversees MPs' remuneration. 

Spads, whose pay is set within specific bands, can earn up to £145,000. Unlike civil servants, they are not eligible for performance-related bonuses. Their salaries are fixed, though exceptions can be made for senior appointments, with discretion granted to the prime minister or Cabinet Office. Sometimes coming under public scrutiny themselves, spads play a critical role in supporting ministers. During my time in the Cabinet Office, the generally cordial working relationships between spads and civil servants were crucial to ensuring that work got done.

"Until we bridge this gap in trust, stories about whether individuals are 'worth' their pay will persist"

The public sector pay debate is often reduced to simplistic arguments of “too much” or “too little”. However, after the 2010 comparisons, the government acknowledged the need for a more balanced approach, focusing on transparency and accountability in setting public sector wages. 

Yet, despite these measures, public trust in government has not improved, and this is undoubtedly a factor in the fairly regular criticism of the way that public servants, of one kind or another, are remunerated. Looking to Sweden, where a similar system for setting salaries exists, there is typically less controversy and less suspicion in the media and among the public. The Swedish system is perhaps more accepted due to the high level of transparency around MPs’ duties and the higher trust in government institutions. The UK could learn valuable lessons from this approach, both in how public sector remuneration is handled and in addressing the deeper issue of public distrust.

Until we bridge this gap in trust, stories about whether individuals are “worth” their pay will persist. Instead, we should be asking what kind of people we want in charge of running the country. Are we attracting leaders with the expertise and dedication to tackle the complex challenges of modern government? And are we willing to compensate them fairly? Ultimately, we must have a better, and broader discussion about what it takes to attract and retain the best talent for public service.

Former senior civil servant and editor Emma Thwaites is writing here in a personal capacity. She is director of global policy and corporate affairs at the Open Data Institute

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