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Ministers to slash civil servant pay-offs

By Channel 4 News

Updated on 05 July 2010

"Golden goodbye" payments to civil servants are to be slashed as government departments face 40 per cent cuts, as Political Editor Gary Gibbon warns women workers could be hit hardest by public sector pay changes.

Big Ben (Getty)

The Cabinet Office have confirmed that ministers intend to go ahead with reforming redundancy terms for civil servants as they try to reduce the costs of cutting staff.

Government figures have suggested that 600,000 public sector jobs could go over the next five years as the Treasury tries to slash Britain's record budget deficit. Some civil servants have received payoffs amounting to six years salary.

Ministers said the Civil Service Compensation Scheme (CSCS) should be reformed to bring it more in line with the private sector.

Political Editor Gary Gibbon blogs: 'pay changes hit women hardest'
The current public sector workforce is about 75 per cent female. It's 77 per cent women in the NHS, 87 per cent in primary schools, 73 per cent in local government. And when the pay freeze finishes, there could be a complete re-think in national pay awards coming down the line behind it.

Read more

The move follows warning at the weekend that Chancellor George Osborne ordered government departments to draw up plans for budget cuts of up to 40 per cent as they prepare for the spending review in October. Treasury sources insisted it was only the start of the review process and that no department would face cuts on that scale.

The Daily Telegraph reported that ministers want to push through reform of the CSCS so that any civil servants made redundant after September 15 will be subjected to the new terms.

Cabinet Office Minister Francis Maude, who is the architect of the changes, is due to address senior civil servants on the government's new, stricter approach at a conference tomorrow.

Mr Maude is said to be concerned that payoffs to civil servants are now significantly out of line with those paid in the private sector.

A commitment to reform the CSCS was part of the coalition agreement between the Conservatives and the Liberal Democrats.

Mark Serwotka, general secretary of the Public and Commercial Services union, said the more generous compensation scheme was there to make up for lower levels of civil service pay.

He warned that strikes were inevitable if the government pressed ahead with measures to curb them alongside pay freezes and job cuts.

A Cabinet Office spokesman said: "As outlined in the coalition agreement, we are looking at ways to reform the CSCS to bring it more into line with good practice in the private sector.

"As in any process like this, our intention would always be to seek to reach a negotiated agreement, which would include protection for lower paid civil servants. We will make an announcement to Parliament in due course."

School projects cut
Meanwhile, Education Secretary Michael Gove is set to announce that he is halting rebuilding projects at some 700 schools which were approved by the former Labour government under the Building Schools for the Future (BSF) programme.

"Ministers have been clear that BSF has not delivered good value for money and that the programme is beset by delays and red tape," a Department for Education spokesman said.

"The budget announced the government will retain the total public-sector capital investment planned by the previous administration.

"But the chancellor was clear that projects with a significant economic return to the country will be the absolute priority in the October spending review - that's exactly what we will deliver on schools."

The plan was condemned by shadow education secretary Ed Balls who said that it would hit construction jobs as well as depriving schools of badly needed new accommodation.

Labour also launched a renewed attack on last month's emergency budget by the chancellor, claiming that the burden would fall disproportionately on women.

Shadow work and pensions secretary Yvette Cooper said in the Guardian she commissioned research by the independent House of Commons Library which showed that more than 70 per cent of the £8bn in additional revenue raised from direct tax and benefit changes will come from women taxpayers.

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