Eligibility for the payouts given to ministers once they leave office will be tightened to prevent those who serve for only a matter of months from receiving them, the Government has announced.
The move is part of an overhaul aimed at restoring trust in standards in public life, which will see the launch of a new Ethics and Integrity Commission.
The commission, created from the Committee on Standards in Public Life, will have a wider, stronger remit to oversee integrity across every part of the public sector.
Ministers will also scrap the Advisory Committee for Business Appointments (Acoba) as part of the shake-up.
Critics have said the watchdog – which assesses the jobs ex-ministers take after leaving government for conflicts of interest – is toothless and unable to enforce its rules properly.
Pat McFadden, the senior Cabinet Office minister overseeing the reforms, said: “This overhaul will mean there are stronger rules, fewer quangos and clearer lines of accountability.
“The Committee on Standards in Public Life has played an important role in the past three decades. These changes give it a new mandate for the future.”
The Chancellor of the Duchy of Lancaster added: “But whatever the institutional landscape, the public will in the end judge politicians and Government by how they do their jobs and how they fulfil the principles of public service.”
Ministers are currently entitled to a severance payment equivalent to three months’ salary when they leave office for any reason, and no matter how long they have been in the job.
Under the changes being announced by the Government, ministers who leave office after a serious breach of the ministerial code or who have served less than six months will not get the payment.
If they return to office within three months of leaving, they will also not receive their salary until the end of that three-month period.
The reforms are aimed at preventing situations like that under the Boris Johnson and Liz Truss governments, which saw some Conservative ministers who served for little more than a month receive payouts of thousands of pounds.
Labour has said some £253,720 was paid out to 35 outgoing Tory ministers who were in post for less than six months during 2022, some of whom were in their jobs for 37 days.
The new Ethics and Integrity Commission would be required to report annually to the prime minister on the health of the standards system.
It would be chaired by Doug Chalmers, a retired lieutenant general who chairs the current Standards Committee.
The committee was set up in 1994 by then-prime minister Sir John Major, after his government was mired in accusations of “sleaze” following a series of parliamentary scandals.
Sir John warned in a recent speech that a small group of politicians were increasingly breaking the rules, and suggested Acoba needed to be reformed.
Ministers have instead decided to scrap it and split its functions between the Civil Service Commission and the Prime Minister’s Independent Adviser on Ministerial Standards.
Under reforms to the business appointments rules, ex-ministers found to have breached them by taking on inappropriate jobs will now be asked to repay any severance pay they receive.
A Liberal Democrat spokesperson said scrapping Acoba was “the right step after years of Conservative sleaze which did so much damage to standards in public life”.
They added: “Its lack of powers to enforce the rules it oversaw meant Acoba was about as useful as a chocolate teapot.
“The Prime Minister must now go further – ban ministerial severance payouts altogether for disgraced former ministers, as well as stripping Liz Truss of her access to the ex-PM allowance fund of up to £125,000 per annum.
“It shouldn’t have taken a year to set up the Ethics and Integrity Commission – and there will be no excuse if the Government attempts to kick these vital issues into the long grass.”
The Conservatives meanwhile accused the Government of watering down its pledge to bolster ethics within Government.
Alex Burghart, shadow chancellor of the Duchy of Lancaster, said: “This is the height of cynicism from the Labour Government – burying the bad news on the watering down of their pledges on Government ethics on the last days of term.
“All that Labour have announced today is just cosmetic rebrands of existing bodies.
“It’s no surprise that Labour have done yet another U-turn, given the constant sleaze and scandal plaguing the last 12 months – from Labour MPs raking in freebies, handing out jobs for the boys in the Civil Service, and ministers being forced out of Government due to their criminal records and corruption allegations.”
