PAC calls for pay flexibility to plug skill gaps

Departments need more flexibility on pay so that civil service organisations don’t feel the need for “bureaucratic reorganisations” designed to escape pay controls and enable them to recruit skilled staff, the Public Accounts Committee has said.

Parliament TV

By Suzannah.Brecknell

15 May 2014

In a report published on Tuesday scrutinising the Ministry of Defence’s (MoD’s) Equipment Plan, the committee said that the MoD is spending £400m a year on consultants to plug skills shortages. The department is setting up Defence Equipment & Support, its procurement agency, as a separate trading entity in order to give it more freedom over pay, terms & conditions.

However, PAC said Treasury and Cabinet Office “should look across government at skills shortages and accept solutions that do not require bureaucratic reorganisations as the only route to enabling departments to recruit skilled people at market rates.”

PAC also noted that the MoD had a £1.2bn underspend in its equipment budget this year, but does not know the reason for this apparent saving. PAC chair Margaret Hodge said the MoD “has no idea whether this is because of genuine savings, or whether costs are simply being stored up for later years because of delays on projects.”

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