Guidance sets out average 2% pay rise for most civil servants

Unions slam “real-terms pay cut” despite flexibility for 3% rises in “priority” cases

Most civil servants are in line for an average pay rise of up to 2%, the Cabinet Office has revealed this afternoon.

Under the pay remit guidance for 2022-23, departments will be able to make average pay awards of 2% – topped up by a further 1% where they can successfully argue the extra bump will help with staff retention, productivity or other priorities.

However, the document stresses that departments “must ensure pay awards are affordable within their spending settlements and the need to balance other budgetary pressures, with consideration of the wider economy and the government’s macroeconomic framework”.

It is up to individual organisations to decide how to hand out the increase – so civil servants outside those priority areas may get rises higher or lower than the 2% average.

Announcing its publication this afternoon, Heather Wheeler, a Cabinet Office minister, said the remit guidance “ensures broad parity with private sector wage settlements while providing fair pay rises for hard-working staff”.

“Civil servants benefit from a competitive employment offer including access to one of the best pension schemes available, amongst other benefits. In addition to this, our ambition is for the civil service to be the most inclusive employer in the country, offering opportunities and a chance to progress in challenging roles, delivering vital public services across the country,” she said.

But Garry Graham, deputy general secretary of the Prospect trade union said that “with inflation rocketing, a National Insurance increase coming in and energy prices going through the roof this 2-3% pay remit guidance means yet another crippling real-terms pay cut for civil servants”.

“Once again the government is using civil service pay as a political football and attempting to balance the books by penalising the people who have delivered so much through the twin challenges of Brexit and Covid. And let’s not forget that civil servants have already had a 20% real terms pay cut since 2010,” he said.

Mark Serwotka, general secretary of the PCS union, said the 2% offer was an “outrage” at a time when inflation was running at 5.5% and food and fuel prices were rising exponentially.

“A government that can afford to write off £8.7bn on unusable PPE – much of it given to party members and supporters – can afford to pay its workers a decent wage,” he said.

“PCS will now be discussing an industrial response.”

FDA general secretary Dave Penman said ministers were “running around with their fingers in their ears trying to pretend it’s business as usual” in the face of the biggest shock to household incomes since the 1970s.

“The government has decided to abandon its own workforce and make no attempt to soften the blow to civil servants, who have spent the last two years helping the country through the health and economic emergencies,” he said.

"Unfortunately, ministers have completely failed to see the damage this will do to morale and the civil service’s ability to attract new talent required to deliver high quality public services.

 "This pay remit guidance will see civil service salary levels fall even further behind the private sector.”

The guidance applies to most officials below senior civil service level, but excludes those in departments that have already agreed separate deals, such as HM Revenue and Customs.

Pay rises 'must ensure value for money'

While the guidance gives departments some flexibility to offer pay rises of up to 3%, they must offset any increase above the 2% average by making savings elsewhere.

These savings can take the form of cuts or “frontloaded, tangible productivity gains” over the pay-rise period or over the full three-year Spending Review period.

“This is to ensure that [the higher pay rises] present no extra cost to the exchequer and no increase to budgetary pressure within departments,” the document says.

Departments wanting to hand out 3% pay awards must produce a “tangible outcomes-based plan” that demonstrates how they will help deliver long-term priorities.

These priorities could include workforce transformation and improvements – including delivering Spending Review priorities such as automation and location strategies – or addressing pay anomalies.

Departments must also seek approval from Cabinet and Treasury ministers if their total paybill – which includes changes to allowances, costs of leave entitlements or other non-pay benefits, and pay restructuring – increases by more than 3%.

“The government wants to ensure that it is attracting the best and brightest to work for the civil service, and rewarding hard working staff fairly. It is important that pay awards ensure sustainability of public finances and deliver value for money for the taxpayers,” the remit guidance says.

“Pay awards must ensure value for money for the taxpayer and it is important that they consider economic conditions. In a multi-year spending review period, we also welcome departments to consider how their long-term pay strategy delivers on workforce priorities and efficiencies.”

Departments can meanwhile request ministerial approval to implement the digital, data, technology and cyber pay framework – a separate capability-based framework that sets maximum pay levels for “developing”, “proficient” and “accomplished” professionals in specific DDaT roles.

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