SCS performance management changes being considered alongside pay reform
Cabinet Office minister’s letter to Senior Salaries Review Body calls for experts to set out the best way to realise "strategic shift” in SCS pay policy
Cabinet Office minister David Lidington in Downing Street Credit: PA
The government is examining possible changes to the performance management regime for the Senior Civil Service as part of Cabinet Office plans to reform pay across Whitehall’s top roles, it has been revealed.
In a letter to the Senior Salaries Review Body setting out the terms for its 2019-20 report, Cabinet Office minister David Lidington said work had been undertaken in recent months to develop plans for pay in the top jobs to be based on professional groups in government.
An initial framework for reform was set out earlier this year in a plan to split SCS pay rates into three groupings and would reward "high-performing” officials and encourage people to stay in their jobs longer.
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Under these reforms, detailed below, Group A would be the majority of civil service professions, while a small number of what the document calls “market-facing” professions would be eligible for higher "guideline" pay ranges in Group B. Group C would be niche, specialist roles, particular to just one or a few departments. Such positions could include roles in medicine, inspectors of education and tax professionals.
In its initial response to the plans, which was included in its 2018 pay decision, the SSRB said it welcomed the government’s intent to “undertake reform of the SCS pay structure, and to develop a long-term vision for the SCS”.
However, it also concluded “there is a long way to go” to develop the planned changes, and Lidington said yesterday that the government was keen to work with the SSRB to develop the plans. “Over the last number of months, work has been under way to articulate further the government’s plans to achieve this significant strategic shift in the SCS pay structures,” he said.
This has focused on “exploring options for reforming the SCS performance management system” as well as the development of consistent pay ranges by professional grouping over time, providing greater reward for high performers, and greater control on how people move through and around the SCS.
The reform is intended to address “some of the biggest issues identified with the current pay system as well as ensuring that the civil service is able to attract and retain key, scarce skills from the external market and balancing incentives in the current system”, he said. “I am keen to give the SSRB full opportunity to bring its members’ insight to bear on how we best realise this strategic vision, and to do this in the most effective way possible. We are pleased that the SSRB welcomed the direction of travel laid out in our 2017 evidence, and look forward to working in partnership with SSRB to further articulate our strategic plan to reach this vision.”
The current performance management regime for SCS requires members to be ranked in three groups: top (25%), achieving (the next 65%) and low (the bottom 10%) relative to their peers following end-year assessments.
Lidington’s letter to Martin Read, the chair of the SSRB, set out no further details on what the change might be, but said he was “keen to give the SSRB full opportunity to bring its members’ insight to bear on how we best realise this strategic vision, and to do this in the most effective way possible”.
The letter said: “We are pleased that the SSRB welcomed the direction of travel laid out in our 2017 evidence, and look forward to working in partnership with SSRB to further articulate our strategic plan to reach this vision.”
Lidington also called on the review body to consider “current and future affordability to the taxpayer” when it considered its 2019 pay recommendation.
In its 2018 recommendation, the SSRB called for an overall increase to the pay bull for the cohort of 2.5% in 2018-19, but this was rejected by government, which instead kept the pay package for senior civil servants within the maximum 1.5% increase that the Treasury’s pay guidance recommended for delegated pay grades
In his 2019 letter, Lidington said: “Public sector wages account for one quarter of total public spending. The last Spending Review budgeted for 1% average basic pay awards, and there will still be a need for pay discipline over the coming years to ensure the affordability of the public service and the sustainability of public sector employment.
“The government must balance the need to ensure fair pay for public sector workers with protecting funding for frontline services and ensuring affordability for taxpayers. For those reasons, I expect affordability to be a critical part of your consideration when determining final awards. This year, I also request that you describe in your final report what steps you have taken to ensure affordability has been given due consideration when reaching your recommendations.”
Lidington said government would submit written evidence in January, and asked for recommendations from the board in the week commencing 6 May.
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