Source · Select Committees · Public Accounts Committee
Recommendation 4
4
Acknowledged
Set out specific actions in pay and reward strategy to address longstanding civil service pay issues
Conclusion
Chronic pay issues within the civil service have lowered morale and risk departments not being able to recruit and retain skilled staff. The Cabinet Office acknowledges that there are longstanding issues within the civil service relating to pay and reward. These include a long-term decline in real-terms pay, which has reduced levels of staff satisfaction within the civil service. As departments can set their own pay scales, there are also persistent disparities in how much people at the same grade are paid in different departments. There is also a lack of coherence in how departments use pay to reward civil servants for good performance. We are concerned that these issues damage departments’ ability to attract and retain staff, including specialist staff where salaries in the private sector can be particularly competitive. The Cabinet Office has promised to introduce a new pay and reward strategy for staff below senior civil service level in 2024. So far, however, there is little specific detail in the Civil Service People Plan on what the new strategy will involve and how it will address long-term pay issues. Recommendation 4: In its forthcoming civil service pay and reward strategy, the Cabinet Office should clearly set out the specific actions it will take to address longstanding issues such as declining real-terms pay; variation between roles paid at the same grade; and disparities in pay between departments, including disparities in the use of performance-related pay and the risk of indirect discrimination.
Government Response Summary
The government states a civil service pay and reward strategy is under development, aiming to outline a coherent reward framework by 2030 and a revised pay framework. However, it provides little specific detail on the actions it will take to address declining real-terms pay or pay disparities, noting limitations of the delegated pay model.
Government Response
Acknowledged
HM Government
Acknowledged
The government agrees with the Committee’s recommendation. Strategy is under development. This will outline the steps the government will take to set out a vision of a more coherent, flexible, and individualised reward framework by 2030 that will enable departments to reward excellence in public service delivery, recognise capability in role, enhance productivity and inspire the acquisition of the skills and capabilities needed to support the current, and future, priorities of government. Alongside a revised pay framework, which will be achieved through the delivery of an employment offer to ensure that the Civil Service continues to provide a modern and competitive package that is well articulated and accessible, exploring how to provide greater clarity and understanding of the pension offer, so that it is recognised for its true value and meets the needs of an evolving workforce, is also key to attracting and retaining talent. The government recognises that under the current delegated model, departments maintain control of their own individual pay systems within the cost parameters set out in the Civil Service Pay Remit Guidance, which limits what can be directed by the Cabinet Office.