Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

PoliceNHSLocal authoritiesLatest NewsPublic sector

Government opens consultation on £95,000 cap on public sector exit payments

by Jo Faragher 10 Apr 2019
by Jo Faragher 10 Apr 2019 Chief Secretary to the Treasury, Liz Truss
Kirsty O'Connor/PA Wire/PA Images
Chief Secretary to the Treasury, Liz Truss
Kirsty O'Connor/PA Wire/PA Images

The government has confirmed plans to introduce a £95,000 cap on payouts for public sector workers when they leave their jobs.

The Treasury has today launched a consultation outlining how ministers will introduce the cap, which was first announced in 2015 by the then chancellor George Osborne.

Public sector payments

Redundancy payments and procedures in local authorities

Public sector exit payments capped

The cap has already been legislated for, as part of the Small Business Enterprise and Employment Act 2015, which became the Enterprise Act 2016.

The cap will cover redundancy lump sums and pension top-up payments, although the government has confirmed that exit payments will continue to be available “so public sector employees can support their families, find new employment or have a bridge until retirement age”.

Figures suggest that around 1,600 people received payouts above £100,000 in 2016/17, costing the taxpayer £198m, including £98m in English local government.

HR opportunities in the public sector on Personnel Today


Browse more HR opportunities in the public sector

Writing in The Telegraph, chief secretary to the Treasury Liz Truss said it was time to “crack down on public sector waste”.

She said: “That’s why we are capping pay-offs at £95,000 for senior public sector workers who leave their jobs. Every year, more than 1,600 highly-paid workers such as council chief executives get six-figure golden goodbyes – all from the taxpayers’ pocket.”

“We simply can’t justify these sums when we’re prioritising spending on things the public actually wants, like schools, hospitals and frontline police.”

The announcement comes after it was revealed that at least two council chief executives received total annual remuneration packages of more than £500,000. Roger Parkin, interim chief executive at Slough Borough Council, received more than £140,000 as compensation when he left the post.

There was also controversy over public-sector payouts when Steve Allen, chief financial officer of the controversial HS2 rail project, stepped down in 2017 after it was revealed the organisation had given out nearly £2m in unauthorised redundancy payments.

Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

The government first announced there would be a cap on public sector exit payments in 2015. There was a consultation at the time, but no developments on how it would be implemented. There will now be another consultation.

The Treasury has suggested the first round of implementation will cover most public sector employers, including the civil service, local authorities, and schools. It could later be extended to cover organisations such as the BBC, the Financial Conduct Authority and the Bank of England.

Jo Faragher

Jo Faragher has been an employment and business journalist for 20 years. She regularly contributes to Personnel Today and writes features for a number of national business and membership magazines. Jo is also the author of 'Good Work, Great Technology', published in 2022 by Clink Street Publishing, charting the relationship between effective workplace technology and productive and happy employees. She won the Willis Towers Watson HR journalist of the year award in 2015 and has been highly commended twice.

previous post
Poor management has led to spike in stress absence
next post
Will the Waterstones Living Wage petition make a difference?

2 comments

Chris Mather 10 Apr 2019 - 5:50 pm

The proposals were to designed to hit high earners, but people with long service and a relatively small salary will also be caught by these proposals and they will probably be in the majority. Alternative pension arrangements could have been made by many of the people affected had they known that their pension would be capped further down the road, despite paying in good faith into the work’s pension scheme for most of their working life. The fairest and simplest way would be to cap the pension entitlements of people on a salary of £95k or more.

martin farnham 25 Apr 2019 - 4:57 pm

I have worked in LG for over 40 years and the my pension scheme has been amended a number of times to suit the LA and the Government. This is because we keep hearing about gold plated pensions. This is not true the number of high earners is a very small number when you take into the total number of workers in LG. This proposal will hit far more workers who are earning the average wage. Apply this to high earners not the average earners.

Comments are closed.

You may also like

Restaurant tips should be included in holiday pay

21 May 2025

Fewer workers would comply with a return-to-office mandate

21 May 2025

Redefining leadership: From competence to inclusion

21 May 2025

Pay awards in real terms could fall for...

21 May 2025

Ryanair demands flight attendants pay back salary increase

21 May 2025

Consultation launched after Supreme Court ‘sex’ ruling

20 May 2025

Uncertainty over law hampering legal use of medical...

20 May 2025

Black security manager awarded £360k after decade of...

20 May 2025

Employers ‘worryingly’ ignorant about stress risk assessments

20 May 2025

UK and EU agree to collaborate on ‘youth...

19 May 2025

  • 2025 Employee Communications Report PROMOTED | HR and leadership...Read more
  • The Majority of Employees Have Their Eyes on Their Next Move PROMOTED | A staggering 65%...Read more
  • Prioritising performance management: Strategies for success (webinar) WEBINAR | In today’s fast-paced...Read more
  • Self-Leadership: The Key to Successful Organisations PROMOTED | Eletive is helping businesses...Read more
  • Retaining Female Talent: Four Ways to Reduce Workplace Drop Out PROMOTED | International Women’s Day...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+