Policy officers and middle managers at the Foreign and Commonwealth Office are the lowest paid in government, the department has told MPs.
The FCO said the pay “situation is becoming unsustainable”, with some staff quitting the department and some candidates rejecting jobs over poor pay.
The Foreign Office has submitted a business case to the Treasury that would see money reallocated from elsewhere in its budget to address staff pay issues, the department told the Foreign Affairs Committee.
In evidence provided to the committee last week, the department said: “Cabinet Office data shows that the FCO currently has the lowest median pay of any government department for policy officers and middle management officers.”
Base pay for policy officers is 19% lower at the Foreign Office than it is at the leading department for pay, while the gap at middle management stands at 20%, it said. The evidence also pointed out that just 11% of London-based staff reported feeling positive about pay in the Civil Service People Survey, ranking the FCO “98th out of the 98 organisations”.
The department also reported that its pay policy for global staff would “continue to be a challenge to our ability to attract the best possible candidates for roles”. In 44% of its overseas posts, staff are paid below the 40th percentile in the local jobs market.
The FCO said it was still “viewed as an attractive employer”, but that the “situation is becoming unsustainable”. It said that 70% of staff leaving cite poor pay as the main reason for doing so, and that during a recent recruitment campaign for policy officers 33 of 159 successful candidates decided not to join the department, with pay a key factor in their decision.
Despite having some flexibility to reward specialist skills, “applicants for specialist roles regularly compare our package negatively to other government departments and external organisations”, the department added. It said that retention of specialists was a particular problem, with staff “looking for more rapid salary advancement and quicker promotion” than FCO is able to offer.
The Foreign Office has submitted a business case for pay flexibility to the Treasury, which is currently under discussion.
In a letter to committee chair Tom Tugendhat, FCO perm sec Sir Simon McDonald said that the business case outlined a proposal to reallocate funds from within the department’s 2015 Spending Review settlement to staff pay.
“If agreed, it would facilitate greater convergence with other international departments and ensure that we can retain the capable and skilled staff we need to deliver HMG’s foreign policy objectives,” said McDonald.
Money would be reallocated from admin savings to target middle management diplomatic grades, which the department said have fallen furthest behind other international departments.
Prospect deputy general secretary Garry Graham said the evidence showed that the “years of crippling civil service pay restraint are catching up with the government and undermining the effectiveness of departments and agencies”.
The trade union boss added that new foreign secretary Jeremy Hunt should make it his top priority to ensure “his department and embassies can pay to hire and hold on to the best staff”.
Prospect, alongside the FDA and PCS trade unions, has threatened the government with legal action if it does not withdraw its pay guidance for 2018-19, which limits rise to 1.5%. The unions say the government failed to consult with them sufficiently before the pay rules were issued on 26 June.