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Update On The Public Sector Exit Payment Cap

Further to our previous article on the issue of the Public Sector Exit Payment Cap, it is now anticipated that the measures will come into force by June 2017.

A Possible Public Sector Exit Payment Cap In Scotland

The Scottish Government is now also looking at the possibility of introducing a Public Sector Exit Payment Cap in order to clamp down on what have been referred to as “golden goodbyes“. Accordingly, the Scottish Government has announced a consultation on the issue. The consultation will not only look at the possible introduction of a Public Sector Exit Payment Cap, but also at clawing back exit payments where individuals return to the public sector, and also at changing exit payment terms. The deadline for responses to the consultation is the 23rd June 2017.

Opposition parties have welcomed the proposals

Rising Costs

The costs incurred in funding severance payments in the Scottish public sector rose again last year to £120 million, an increase of £8 million on the year before. This included £849,842.00 that was paid to just 7 senior members of staff at Coatbridge College, which included a severance payment of £304,000.00 to John Doyle, the former principal. An audit of the Coatbridge College severance packages conducted by the Auditor General for Scotland, Caroline Gardner, concluded that there were “serious weaknesses in governance relating to severance arrangements”, and that the payments “exceeded the terms of the college’s severance scheme”.

Clamp Down

In its consultation briefing, the Scottish Government stated: “The Scottish Government seeks to ensure severance arrangements are fair and equitable while providing value for money for the people of Scotland.”

In response, Murdo Fraser, the Scottish Conservative Shadow Finance Secretary stated: “It’s welcome the SNP is finally realising this is a problem which needs to be addressed. The time to do this should have been 10 years ago when the recession was beginning to bite across the country. Since then, millions of pounds in public money has been needlessly given to those who have enjoyed excessive pay-outs. That’s irresponsible government, and I hope ministers use this opportunity to finally address that.”

Posted in General Employment Law, Public Sector Exit Payment Cap and tagged , .