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15 July 2016

Payouts for David Cameron’s inner circle will be seen as a slap in the face by many civil servants

Civil service unions blast the outgoing prime minister as a "hypocrite" for ignoring civil service advice and boosting special advisers' exit pay.

By Matt Foster

When he left Downing Street for the final time as prime minister this week, David Cameron had some very warm words for the civil servants who had served him loyally for six years. Britain’s officials, he said, had shown a “professionalism and impartiality” that stands as one of the country’s “greatest strengths”.

And when Ukip’s sole MP Douglas Carswell used one of Cameron’s final sessions of PMQs to have a pop at “Europhile mandarins” being put in charge of Brexit, the then-Tory leader was quick to leap to the organisation’s defence.

 “They are impartial, they are hard-working, they are the best of British,” he said.

But if actions speak louder than words, it’s one of Cameron’s last decisions at Number 10 that will stick in the minds of many civil servants.

Newly-published letters reveal that, in his final days in Downing Street, Cameron took the unprecedented step of overruling the advice of one of his top civil servants – Cabinet Office permanent secretary John Manzoni – to order one-off payments totaling more than a quarter of a million pounds to his political special advisers.

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Spads are not the same as permanent civil servants – and in some ways they have a tougher gig than their politically neutral counterparts. They work long hours, only to be stereotyped as Malcolm Tucker-esque masters of the dark arts.

And, while years of cuts have left the civil service’s reputation as a job for life somewhat wide of the mark, Spads have to live with the constant prospect of being just one reshuffle or change of government away from being booted out with their minister.

Before this week’s dramatic installation of Theresa May at Number 10, the team around Cameron would have been operating on the assumption that they had until September to make plans for a new job. By Wednesday evening, they were officially unemployed.

Against this backdrop, Cameron’s office felt that his long-serving advisers should get an extra months’ salary, meaning they would receive six months’ pay, instead of the four-and-a-half months’ they were entitled to under their contracts.

But that move was challenged by Manzoni, who has a duty to parliament to ensure taxpayers’ money is spent properly.

In a strongly-worded letter to Cameron, raising formal objections to the decision by seeking what’s known as a ministerial direction, the Cabinet Office permanent secretary said he did “not believe there is a case for awarding higher sums than those for which the contract allows”.

“Legal advice supports this position, and lawyers have been clear that awarding a further month’s salary for special advisers in this position would constitute a payment above their contractual entitlement,” he added, while warning that the move would add an extra £282,892 to the severance bill for the outgoing Spads, and could set a precedent right across Whitehall.

The contracts which those Spads had signed up to were already, Manzoni pointed out, “designed to provide some degree of certainty and security for individuals who take on these roles in the knowledge that their appointments may come to an end at short notice”.

Cameron, however, chose to over-rule that advice, ordering the Cabinet Office permanent secretary to see that the extra months’ payment was given not just to his Number 10 advisers who had been reappointed after the general election in 2015, but to all other Spads in the same position. 

“The termination of their employment has been sudden and unexpected, and he does not wish to exacerbate an already difficult and uncertain time for them by inferring that their long and loyal service is not fully recognised,” Cameron’s office said.

The prime minister is, of course, perfectly entitled to ignore civil service advice – by the very nature of our political system, officials advise, and ministers decide. And, on a personal level, there’s undoubtedly something noble in a boss who feels he has a duty to ensure his staff have a bit more security when they go down with him.

So why is this move particularly galling for civil servants? Put simply, many feel that it’s one rule for Cameron’s team, and another rule for the permanent workforce.

Earlier this year, the Cabinet Office decided to revisit a deal it had only agreed in 2010 after months of tough talks with civil service trade unions, and outlined plans for fresh cuts to the redundancy pay that officials are entitled to when they’re laid off. 

The move took many in the workforce by surprise, and while the outcome of the consultation is still awaited, reforms floated by the Cabinet Office could see a cut of more than 25% in the amount officials are able to take at exit.

It’s worth bearing in mind that the typical civil servant isn’t the fat cat mandarin of caricature. According to the Office for National Statistics, the median salary for an administrative level civil servant – around 44% of the workforce are at this grade – is just £18,900. Even in London, where many senior civil servants are based, the median salary is just over £30,000. By contrast, Special Advisers in Cameron’s team were taking home up to £140,000 a year.

As well as the planned cuts to redundancy pay, civil servants – like the rest of the public sector – have seen their annual payrises frozen at 1% a year since 2013, a policy George Osborne, before he was ousted, said he wanted to keep in force until the end of the decade, whatever the state of the economy. And the organisation is at its smallest size since the second world war, having shed tens of thousands of jobs since the financial crisis.

It’s for that reason that the move by Cameron to ignore the terms of a contract and reward his special advisers, while seeking to further changes to the terms and conditions that permanent civil servants thought they’d signed up to, has immediately triggered accusations of double standards from the unions.

Dave Penman, general secretary of the FDA, a normally reserved union which represents senior managers, branded it “an astonishing act of hypocrisy” from the outgoing prime minister, that sent “a clear message about who he valued most”.

One senior union figure was slightly less diplomatic than that, telling Civil Service World: “It makes my piss boil.”

Both the National Audit Office and the Public Accounts Committee will now look into the value-for-money implications of Cameron’s decision to ignore Manzoni’s advice. 

But beyond the public spending question, there’s a deeper issue at play. Gestures like these from the top of government really do matter to civil servants, who are used to being blamed when things go wrong, and stereotyped as lazy pen-pushers.

The reality is very different, and high morale will be even more important as the organisation comes to terms with Theresa May’s big reorganisation of Whitehall, and as officials start knuckling down and getting on with withdrawal from the European Union – an outcome they were explicitly prevented from preparing for by ministers.

Cameron’s final flourish as prime minister may have been well-intentioned. But, if the reaction of Civil Service World readers on Friday is anything to go by, it’s one that won’t be forgotten by the workforce.

 “As someone who is currently being made redundant from the civil service and who has had to accept a reduced package because the Cabinet Office would not approve my employer topping up my pension, how wonderful to see the money ‘saved’ being given to Cameron’s staff,” one told us.

“It leaves a bitter taste in my mouth after 37 years’ service. Absolute hypocrites who say one thing and then do another. Shame on them.”

This article was originally published on Civil Service World. Matt Foster is deputy editor of Civil Service World, and a former assistant news editor for PoliticsHome.com. His views are his own.​