Civil service boss urges unions not to strike over redundancy package changes

Civil service boss Gus O’Donnell has urged PCS members not to strike over plans to cut workers’ redundancy packages – a move which could save £500m in three years.

PCS is expected to continue to ballot staff for industrial action from this Thursday (4 February) over the changes to the Civil Service Compensation Scheme, which will come into effect this April and include cutting redundancy packages from up to three years’ pay to as little as 24 weeks.

Plans to overhaul the redundancy scheme for workers made redundant gained the backing of five trade unions today after 18 months of consultation, including Prospect, GMB and Unite. But PCS is pressing ahead with strike threats.

Under the current system, civil servants who have worked 20 years at Whitehall are entitled to two years’ pay in a lump sum if they take voluntary redundancy and three years’ pay if the redundancy is compulsory.

Gus O’Donnell, head of the Civil Service and permanent secretary at the Cabinet Office, said: “I believe the decision by the PCS union to continue opposing the proposals and ballot its members for industrial action is wholly misguided.”

He added: “I would therefore urge PCS members to think hard about how to vote.  Industrial action can only damage the services we provide to the public.”

In April last year, Personnel Today reported that the government was attempting to delay an expected jobs cull across Whitehall until the cuts in Civil Service severance pay were imposed, making the redundancies far cheaper, according to experts.
Cutting redundancy packages to as little as 24 weeks’ payment would mirror private sector terms and save £500m over the next three years, the government has claimed.

The five Civil Service trade unions backing the changes are: First Division Association, Prospect, Prison Officers’ Association, GMB and Unite.

Separately, PCS union is seeking a judicial review over the plans as it claims its members were not consulted properly over the changes.

Other changes confirmed:
• Civil servants made compulsorily redundant will receive cash compensation of up to two years’ pay – down from three years’ pay.
• For the lowest paid, cash payments will be capped at three years’ pay or £50,000, whichever is lower.
• Anyone who receives a severance payment and then returns to work for the Civil Service will have to pay back their cash settlement on a pro-rata basis. 
• The minimum qualifying period for a redundancy payment will be increased from one to two years.
• The new compensation scheme will have no effect on existing civil service pension schemes. 


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