It’s hard to get your head around what the Spending Review will actually mean. You can look at endless graphs and see that, compared to predictions in the two previous budgets held this year, the figures don’t look quite as cataclysmic as everyone (well, the very same chancellor) was predicting.
As ever, there were a few surprises – budgets protected that we thought would be cut and new taxes. And, as always, the devil is in the detail. Even protected or increased budgets are still predicated on delivering substantial efficiencies. “Spend more but save more” will be a new skill to learn for public servants used to “boom or bust”.
We have long argued that an elected government has the right to determine the size of the civil service, but that it needs to demonstrate to the taxpayer and public servants how it will match commitments with the resources allocated.
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The long-awaited Single Departmental Plans will be an opportunity to test whether the government is serious about being held to account on this issue. I hope that it is, as I was astonished to read rather glib statements in the Spending Review, such as: “By focusing on its reform priorities and delivering significant efficiencies within its back office functions, MoJ will be able to reduce its administrative budget by 50% by 2019-20.” When you read the first part of that sentence you expect the figure at the end to be 10 or 15% at most – not a whopping 50%!
Another nugget in the small print of the chancellor’s blue book was this: “The government will continue to modernise the terms and conditions of public sector workers, by taking forward targeted reforms in areas where the public sector still has far more generous rights than the private sector.” It then targets redundancy terms and sick pay arrangements, again referencing the private sector as a comparator. This has been followed by speculation/leaks/well-placed sources – you decide which – that suggest the Treasury has its sights firmly set on redundancy terms.
So what are we to make of this? Firstly, the rank hypocrisy of quoting “the private sector” as an example is almost impressive in its audacity. This month I will be up before the Senior Salaries Review Body, once again quoting figures that demonstrate how far behind the market civil service pay levels are. And these are not my figures – this is the government’s own data, analysed by independent consultants.
While the examples at senior civil service level are almost farcical, in the last parliament the chancellor got a little ahead of himself and announced a review on regional pay. He had assumed that a bloated public sector was skewing the market outside of the south-east hothouse. That report, published on one of those good days to bury bad news, demonstrated that from just above executive officer level, the civil service was behind the market for comparable jobs. The further up the grading structure you got, the closer to London, or the more specialist the role, the further behind they fell. Put all three together and you get those farcical figures I mentioned.
We would welcome a review of pay compared to the private sector. We would love one of those independent reviews where the recommendations, while uncomfortable, were backed up by independent evidence. The FDA was on record supporting the independent review of MPs’ pay, because if the government is going to look at issues around reward for public servants, then it needs to consider all aspects of reward and reach conclusions that are evidence-based. That’s what the parliamentary standards watchdog IPSA did in its recommendations in July. It looked at pay and other elements of the package for MPs, including pensions and re-settlement payments (redundancy). So, Mr Chancellor: what’s good for the goose is good for the gander.
Not only is the cherry-picking of examples from the private sector insulting, it comes against a backdrop of ever-increasing pressure on departments to recruit. Just after the Spending Review, the minister for the Cabinet Office and the civil service chief executive said plans were being drawn up for new pay arrangements for specialists. In the Crown Commercial Service and the MoD’s bespoke trading entity DE&S, exemptions are already being made from civil service pay policy. Elsewhere, we’re seeing the age-old problem of recruits from outside the civil service being recruited at a premium.
So ministers keep talking about hammering down public sector terms to private sector levels, when at the same time they’re having to dream up new exemptions in order to compete.
When I talk to union colleagues who negotiate in the private sector they’re aghast that these issues – critical to delivering a skilled and motivated workforce – are bounced around as political footballs.
All of the evidence demonstrates that a new, intelligent approach is needed on the total reward package for the civil service. My fear is that, once again, the very people being tasked with delivering ever more with ever less are treated at times as little more than another source of efficiency savings, or worse, a convenient vehicle to demonstrate how tough a minister is.