Source · Select Committees · Public Accounts Committee
Recommendation 17
17
Deferred
Substantial variation exists in departmental performance-related pay approaches and spending
Conclusion
Departments vary quite substantially in their approaches to performance-related pay, including how much they spend on it. For example, departmental per-head spending on performance-related pay in 2021–22 ranged from £13 to £1,366 per employee, for staff 27 C&AG’s Report, para 3.2 28 C&AG’s Report, para 1.10, Figure 6 29 Q56 30 Q54 31 Q56 32 C&AG’s Report, para 3.4 33 C&AG’s Report, para 3.5 34 C&AG’s Report, paras 16–18 35 Qq60–62 36 Qq63–64 Civil service workforce: Recruitment, pay and performance management 13 below SCS level.37 The Cabinet Office expressed surprise about the level of variation in departments’ performance-related pay arrangements, remarking that the extent of this variation was higher than it would have expected. It added that the new pay and reward strategy promised in the Civil Service People Plan would need to look harder at the role performance-related pay should play in the civil service, with the intention of rewarding employees for higher output and higher quality of work.38 We also asked the Cabinet Office how it guards against the risk of indirect discrimination where the quantity and quality of an individual’s work may be measured more easily in some roles than in others. It told us that objective data will become increasingly available in this area, and that there are “some checks and balances” in how people moderate performance across individuals.39 Performance management
Government Response Summary
The government agrees and states a new Civil Service Reward Strategy is under development with an initial target implementation date of Winter 2024, aiming for a coherent reward framework by 2030, and acknowledges departmental control over individual pay systems.
Government Response
Deferred
HM Government
Deferred
4.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2024 4.2 As set out in the Civil Service People Plan 2024-27, a new Civil Service Reward 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. 4.3 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. 4.4 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.