Recommendation 4

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.