Despite a settlement on redundancy terms agreed with the last Cabinet Office minister Francis Maude – which he described as “for the longer term” – less than five years later the government seems intent on rushing through yet another radical change.
The government wants to reduce the cost of making civil servants (and others in the public sector) redundant by limiting public sector payouts to £95,000, and it wants to do this just before cutting hundreds of thousands of jobs. However, private sector experience of workforce reductions should teach us all that managing successful radical change requires less stick and more carrot.
Morale is low in the civil service. The prospect of more than a decade of year-on-year pay cuts; a divisive performance management system; cuts to pension provision; restrictions on civil servants’ freedom of speech; and ever increasing workloads that are taking people to breaking point is hardly a recipe for a happy workplace. Introducing an arbitrary cap on the cost of individual exit packages isn’t about managing the public sector workforce – it’s about punishing those who have dedicated their careers to the public service.
The government portrays the cap as being something only for high earners to be concerned about. This is deliberately misleading. The reality is that long-serving teachers, social workers, nurses and firefighters could be caught by this. Payouts are determined by length of service and salary: you could be a long-serving civil servant earning less than £27,000 a year and be hit by the cap. The government is well aware of this; when it originally announced the policy before the election it committed to protect those lower earners. But this consultation shows it is not proposing to honour that.
The situation in the public sector is far worse than in the private sector for one, perhaps surprising, reason. There is a complete absence of an adequate redeployment process. So while one department is crying out for a finance director with experience and skills, another is trying to make two redundant. Coordination between departments takes time and needs the resources that are being starved from central government.
The irony is that the very people who are being tasked with delivering the government’s demanding agenda, ever more for ever less, are the very ones that this will continue to demoralise. Arbitrary caps – whether it’s on pay levels or redundancy payments – may make good soundbites before an election, but they rarely make good policy.
Public services face a huge challenge over the coming years. They need to continue to attract and motivate the best talent, while at the same time managing another significant reduction in staffing. I fail to see how this sort of approach can help it do either.
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