Gloves off as spending cut soften-up gathers pace

First those 40% cut plans - now civil service redundancy and strike rules are in the spotlight.

Last Updated: 31 Aug 2010

As if the news that some government departments face budget cuts of up to 40% wasn’t enough public sector pain, today it emerges that civil service redundancy pay may be slashed and strike ballot rules toughened up, too.

Redundancy pay for civil servants is currently capped at a maximum of two years’ salary, itself cut from six-and-a-half years by the old government last year. But this is still a long way from the private sector minimum of a week for every year of service; even the more generous employers only usually offer a maximum of a year’s salary.

The rumour is that the Camer-egg government wants to see public sector redundo more in line with that in the private sector - presumably because if it’s not reduced substantially, making anything like the cuts they want to make will simply be too expensive. Slashing compulsory redundancy could also give the powers-that-be more room for manoeuvre in the gathering storm over job cuts (which could hit 600,000) by allowing them to offer more generous terms to those who agree to go quietly.

The legislation required won’t go through without a fight, though. In May the PCS union won a judicial review relating to last year’s changes, and it seems ready to take up the cudgels again this time. General Secretary Mark Serwotka is predicting a ‘fierce response’ from his members - some of whom might presumably find themselves in the unhappy position of having to draft the legislation which might put them out of a a job…

The third leg of this particular package of gloom is the suggestion that the rules governing strike action may also be tightened up, to require a minimum number of votes to be cast before a strike could be called.

So it's no wonder ministers and union leaders are meeting for talks today. We can’t imagine the atmosphere will be too friendly. (And remember: this is a Con-Lib coalition. What on earth would ‘call me Dave’ and his crew be getting up to if they were left to their own devices?)

To be fair, no-one is suggesting (for now at least) that actual cuts will amount to anything iike 40%. And of course the deficit needs to be cut: no-one wants Britain to become the next Greece, Ireland or Spain, after all. But here at MT we would like to sound a note of caution for our energetic new leaders. Firstly, the public and private sectors do not exist in discrete parallel universes, and drastic cuts in one will inevitably lead to pain in the other. Secondly, people of all political stripes will accept that even deep cuts need to be made on the basis of national interest – but it helps enormously if those wielding the axe don’t appear to be enjoying it too much…

In today's bulletin:
BT faces its first strike in 23 years
Gloves off as spending cut soften-up gathers pace
Kraft sheds three-quarters of Cadbury's senior managers
Books Special: How They Blew It, by Jamie Oliver and Tony Goodwin
MT Expert's Ten Top Tips: Get more from your investors

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