The union's Civil Service Sector Executive Committee (CSSEC, elected by members), met on 29 September to consider the final offer and the outcome of the Treasury and Cabinet office consultations on severance arrangements in the wider public sector and civil service respectively.
After considerable debate, the CSSEC unanimously agreed to recommend that members vote to accept the Cabinet Office final offer.
"Prospect is angry that the Government so readily revisited the 2010 terms of the CSCS, and has been one of the harshest critics of its crude cost-cutting approach," said the union's deputy general secretary Garry Graham.
"We have negotiated tirelessly to secure the best possible outcome for our members. We were clear from the beginning that we would ballot them on the outcome and it was ultimately for members to take a view."
The Treasury and Cabinet Office consultations closed formally in early May. Prospect submitted detailed, robust evidence. It also encouraged members to write to their MP and to respond to the consultations – their efforts made a difference and reinforced how seriously Prospect took this matter.
In early June, the Cabinet Office tabled an “interim” offer to the unions. Prospect's CSSEC felt the interim terms were not acceptable but provided the basis for further negotiations.
"Our view was that to walk away from the table at that stage would have been an abdication of responsibility: it would have given the Minister at the Cabinet Office a green light to impose significantly worse terms before the summer parliamentary recess," said Graham.
In that context Prospect, the FDA, UNISON, GMB and others agreed to continue negotiations with the Cabinet Office.
Detailed, tough and intensive negotiations took place over the summer through 'til late September. On 26 September the Cabinet Office gave the unions their final offer.
Graham said the offer represented significant movement in relation to the initial proposals and to the “interim” offer made in June. In particular, and as a result of tough negotiations:
- those at risk of redundancy will have access to the best possible terms
- the cap for those at risk of redundancy has been increased from the original proposal of 12 months to 18 months
- for existing staff: the current contractual notice period on Compulsory Redundancy (normally six months) is maintained
- for all staff: the existing notice periods for Voluntary Exits and Voluntary Redundancy (normally 3 months) are maintained
- the lower paid underpin has increased from £23,000 to £24,500
- individual flexibilities are provided for those aged between 50-55 who are members of the Classic or Premium pension schemes who wish to top up their pensions
- flexibilities are provided for those “caught” by the £95,000 cap in the Enterprise Act to top up their pensions
- inefficiency terms – certainty has been provided, where none existed, of the eligibility of Alpha and Nuvos scheme members for consideration. Inefficiency terms have been linked to the best possible exit terms ie the tariff for Voluntary Redundancy
- a revised Protocol has been negotiated to seek to minimise the need for compulsory redundancies.
"None of this would had have happened had Prospect not been negotiating hard on members' behalf," said Graham.
"We were also clear throughout negotiations that members could only consider any offer in the context of the outcome of the Treasury consultation,” he explained.
“This was to avoid the potential outcome that the Treasury framework was more beneficial than the CSCS terms put to members (unlikely in the eyes of many).
“We also wanted to ensure that any CSCS proposed terms would not be ‘unpicked’ in light of a more draconian Treasury view (a more likely threat).”
He said this strategy had proved effective in that:
- the CSCS terms exceed the Treasury suggested ceiling of 15 months for the maximum number of months’ salary that can be paid on exit
- they retain the principle of pension top up for those over 55
- pension top-up is not capped at “the redundancy lump sum to which to which the individual would otherwise be entitled.”
Graham said that while Prospect welcomed these hard won improvements, it did not believe the Government had been fair or reasonable in its approach.
“We believe the proposals tabled by the Treasury and the Cabinet Office have been driven by a crude desire to cut costs.
“But trade unions have to confront the world as it is, not simply as we wish it to be. That is why we have been involved in negotiations and pressing as hard as we can on our members’ behalf.
“So we have tempered and mitigated the impact of the proposed changes we believe the Government was determined to drive through.
“But the fact remains that:
- accrual will reduce from a month per year of service to 3 weeks (in line with the Treasury recommendations)
- the cap on the cash amount for VE and VR will reduce to a maximum of 18 months' salary (down from 21 but higher than the Treasury recommended 15)
- the cap on CR to reduce from 12 months to 9 months
- access to pensions top up will be standardised to 55 – impacting on Classic and Premium members.
Final offer terms
The key elements of the Cabinet Office final offer include:
- Voluntary Exit capped at 18 months’ salary
- Voluntary Redundancy capped at 18 months’ salary
- Compulsory Redundancy capped at nine months’ salary
- the standard tariff to be three weeks’ per year of service
- to maintain flexibility in Voluntary Exit terms to offer between statutory terms and the standard tariff
- to allow employer-funded top-up to pension from age 55 and for this minimum age to track 10 years behind state pension age
- to offer a partial buy-out option for employees above minimum pension age where the cash value of the exit payment is insufficient to fully buy out the actuarial reduction, or where the full exit payment is otherwise affected by restrictions in legislation (e.g. the introduction of the £95,000 exit cap)
- Compulsory Redundancy notice periods to be set at three months for new starters
- increase the lower paid underpin to £24,500 (from current £23,000)
- the Inefficiency Compensation tariff to be reformed to align with Voluntary Redundancy terms (i.e a maximum of 18 months’ salary); and
- a revised Protocol for avoiding redundancies.
The Cabinet Office Minister made it clear that if a sufficient number of trade unions do not signify agreement by 31 October, more detrimental terms will be imposed.
“This is a crass and high handed approach which gives a flavour of the challenges we faced in negotiations,” said Graham.
The legal duty of the Minister is to ‘consult with a view to reaching agreement’. If they conclude that they have consulted and agreement has not proven possible, the Minister is free to legislate. The legislative process does not require a debate in the House of Commons or an affirmative vote.
Prospect very carefully considered the final offer. We share members’ anger: the Government has put them in an invidious position and reneged on the 2010 agreement that we believed was long term.
In that context, we have pressed for assurances that any agreement reached is enduring in nature. There have been protracted discussions about this, including the intervention of Prospect’s General Secretary, and meetings with the Cabinet Office Minister.
As a result of that pressure, the Minister has stated (if agreement is reached) “that this is a strong negotiated settlement reached with trade unions that have engaged constructively in discussions that means that this provides a firm foundation for the management of the Civil Service and its people for a generation.
"This administration will not seek to deviate from this agreement and whilst I cannot bind future administrations I cannot see circumstances in which successive administrations would seek to do so either. With this reform concluded, I want to work with Trade Unions on the aspirations we both have to make the Civil Service an even better place to work.”
This goes further than any verbal statement made by any minister in 2010. It is a direct commitment to the unions concerned, and if agreement is reached it will be reflected in a ministerial public statement. It is for members to take a view.
“If agreement is reached, we will hold future ministers to account,” said Graham. “If future administrations seek to renege on the commitments entered into (if members vote to accept the offer) we would consult members and other unions on a ballot to trigger industrial action. We would set this out explicitly in our response to the Cabinet Office.”
Prospect’s CSSEC recommendation
The CSSEC has very carefully considered the final offer received. The offer was the matter of considerable debate and much soul searching.
Ultimately the Executive believes the final offer made by the Cabinet Office is the best achievable by negotiation:
- it compares favourably with the outcome of the Treasury consultation and the initial proposals tabled by the Cabinet Office.
- it also provides valuable protections in terms of the Protocol to help minimise the need for compulsory redundancies and the duty and responsibilities of employers to consult with unions and maximise redeployment opportunities on a cross civil service basis – with the important oversight of unions and Cabinet Office.
“The CSSEC has not taken this decision lightly,” said Graham. “It is ultimately members’ decision as to how they will vote. If they choose to vote to reject the proposals, it has to be on the clear understanding that the Government will impose more detrimental terms, and the valuable protections proposed in the offer will be withdrawn. A sustained campaign of industrial action would be needed to seek to change the government’s position.”
“We are more than willing to lead such a campaign, but based on membership feedback we are concerned that there is not an appetite for the protracted action that would be required and the loss of the improvements we have been successful in negotiating.”
Prospect’s ballot runs from 10 October to noon on 31 October. Graham stressed that members’ votes are important: “A high turnout will send an important message to the Cabinet Office as to how strongly members feel with regard to this issue.”
Details of offer
The full details of the offer were laid out in a letter and annexes from the Cabinet Office to the trade unions. These are available to download from the following links:
Prospect’s circular to civil service members about the ballot: https://library.prospect.org.uk//download/2016/01917
Final Offer Letter: https://library.prospect.org.uk//download/2016/01910