Slide background
Slide background
Slide background

Ministry consults on impact of exit payment reforms on local government workforce

The Ministry of Housing, Communities and Local Government (MHCLG) has launched a consultation on proposals for reforming exit payment terms for local government workers.

The MHCLG stressed that the consultation was not seeking views or representations on the government’s position regarding exit pay reform, saying the framework for reform had been produced following extensive consultation led by HM Treasury.

Instead, the consultation is seeking information on:

  • The effect/s that the proposals for reform will have on the regulations which currently govern exit payments (including both redundancy compensation pay and early access to pensions) in local government.
  • The impact that the proposals for reform outlined in paragraph 3.4 will have on the local government workforce.

Paragraph 3.4 reads: “The overarching framework was set out in the Government Response published in February 2016. The key elements can be summarised as:

  • A maximum of three weeks’ pay per year of service;
  • A maximum of 15 months on the amount of a redundancy payment;
  • A maximum salary of £80,000 on which an exit payment can be based;
  • Limiting publicly funded pension top-ups;
  • A £95k cap on the total of all forms of compensation, including redundancy payments, pension top-ups, compromise agreements and special severance payments.”

The consultation asks amongst other things whether there any groups of local government employees that would be more adversely affected than others as a result of the various proposals.

It closes at 11:45pm on 9 November 2020.

“Consultation responses will inform a full impact assessment, including equalities considerations which will be issued alongside the regulations when these are laid before Parliament,” the Ministry said.

Slide background