Government to ban six figure local gov payoffs

Liz Truss

The government want to introduce a £95,000 cap for exit payments when public sector workers leave their jobs.

Official figures reveal that over 1,600 highly-paid workers received payments of more than £100,000 in 2016-17 when they left public sector roles, costing the taxpayer a total of £198m, with English local government six-figure payments alone accounting for £98m.

Exit payments across the public sector were £1.2 billion in 2016-2017.

Chief Secretary to the Treasury, Liz Truss, said: ‘It is clearly wrong when people leave public sector roles with massive payoffs. It incenses the public when they see their hard-earned money used badly like this.

‘That’s why we are capping exit payments to stop unacceptably large pay-outs for senior managers.’

However, the FDA union called the announcement ‘disingenuous’.

FDA general secretary, Dave Penman, said: ‘Not satisfied with previous cuts to the pay, pensions and redundancy arrangements of public servants, the government is now imposing a further attack on redundancy terms.

‘As she knows all too well, when the Conservatives first mooted this arbitrary cap in 2015, it included protection for those earning less than £27,000 a year.

‘Not only has this protection been abandoned, but it demonstrates that their blunt approach to capping redundancy payments will hurt teachers, police officers, fire fighters, doctors, paramedics and other individuals serving the public.’

The government has launched a consultation today outlining how they plan to introduce the cap. Local government, civil service police forces, schools and the NHS are included in the first round which covers the vast majority of public sector workers.