The most senior and long-serving civil servants could be offered a maximum of Β£95,000 to quit their jobs as part of a government efficiency drive.
Sky News reported last week that several government departments had started voluntary exit schemes for staff in a bid to make savings, including the Department for Environment and Rural Affairs, the Foreign Office and the Cabinet Office.
The Department for Health and Social Care and the Ministry of Housing and Local Government have yet to start schemes but it is expected they will, with the former already set to lose staff following the abolition of NHS England that was announced earlier this month.
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Rachel Reeves, the chancellor, confirmed in last week’s spring statement that the government was setting aside Β£150m to fund the voluntary exit schemes, which differ from voluntary redundancy in that they offer departments more flexibility around the terms offered to departing staff.
Ms Reeves said the funding would enable departments to reduce staffing numbers over the next two years, creating “significant savings” on staff employment costs.
A maximum limit for departing staff is usually set at one month per year of service capped at 21 months of pay or Β£95,000.
Whitehall sources stressed the figure was “very much the maximum that could be offered” given that the average civil service salary is just over Β£30,000 per year.
Whitehall departments will need to bid for the money provided at the spring statement and match the Β£150m from their own budgets, bringing the total funding to Β£300m.
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The Cabinet Office is understood to be targeting 400 employees in a scheme that was announced last year and will continue to run over this year.
A spokesman said each application to the scheme would be examined on a case-by-case basis to ensure “we retain critical skills and experience”.
It is up to each government department to decide how they operate their scheme.
The voluntary exit schemes form part of the government’s ambition to reduce bureaucracy and make the state more efficient amid a gloomy economic backdrop.
Ahead of the spring statement, Ms Reeves announced plans to cut civil service running costs by 15% by 2030, which ministers have said will save Β£2.2bn.
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The move could result in 10,000 civil service jobs being axed after numbers ballooned during the pandemic.
Ms Reeves hopes the cuts, which she said will be to “back office jobs” rather than frontline services, but civil service unions have raised concerns that government departments will inevitably lose skilled and experienced staff.
The cuts form part of a wider government agenda to streamline the civil service and the size of the British state, which Sir Keir Starmer criticised as “weaker than it has ever been”.
During the same speech, he announced that NHS England, the administrative body that runs the NHS, would also be scrapped to eliminate duplication and cut costs.
