Budget 2010

Read the email sent to members on 22 June 2010:

The following relates to the final budget of the Labour government.

Related documents:

Chapter of the 2010 budget relating to public services: Chapter 6 - Protecting Public Services

Senior Salaries Review Body document providing information on a consultation on a code of practice for senior pay in the public sector:
Initial report on Public Sector Senior Remuneration 2010

Report by Ian Smith into the scope for further government relocations out of London: Relocation: Transforming where and how government works

Pre-Budget Report - December 2009

Smarter Government White paper and update on progress:
Putting the Frontline First: Smarter Government
Progress Update: Streamline central government for sharper delivery

Analysis

There were a number of announcements made in the Chancellor's final Budget speech of this Parliament that directly affect the civil service.

Pay

The Chancellor confirmed that there will be a cap of 1% on basic pay uplifts in the public sector for 2011-12 and 2012-13. The government previously announced on 10 March 2010 that there will be no general uplift for the Senior Civil Service this year.

In addition, the Senior Salaries Review Body has started a consultation on a code of practice for senior pay in the public sector, due to be finalised by July 2010. The FDA will be responding to this consultation. You can access the document here: Initial report on Public Sector Senior Remuneration 2010.

Relocation

The Chancellor had commissioned a report by Ian Smith into the scope for further government relocations out of London. The report was published yesterday and can be accessed here: Relocation: Transforming where and how government works.

In his report, Ian Smith outlines the case for a further 15,000 jobs to be relocated within five years and a long-term target of a third of the government jobs in London relocated within ten years. The FDA will be seeking consultation centrally and with departments, which are being asked to identify which of their activities could be relocated.

Efficiency savings

The Government announced in the Pre-Budget Report plans for £11billion of further efficiency savings by 2012-13 from the Operational Efficiency Review conclusions and from Putting the Frontline First: Smarter Government White Paper.

A number of departments made announcements yesterday on their contribution to these savings. There is a tremendous amount of detail to be considered and much of this will be done at departmental level. You can access the Pre-Budget Report, the Smarter Government White Paper and an update on progress via links at the top of this page.

Public sector pensions

The Budget re-iterated the Government's intention (set out in the 2009 Pre-Budget Report) to achieve £1billion in savings from 2012 from the introduction of cost capping and sharing provisions for the civil service, teachers', NHS and local government pension schemes.

A valuation of the civil service pension scheme will be produced during 2010 and its conclusion will be subject to detailed consultation between the Cabinet Office and the civil service unions. In the event that the valuation identifies an increase in pension costs, a number of options for addressing any cost pressures will be considered as part of the consultation process. This will include consideration of the statement set out in the Pre-Budget Report that "public sector workers will make a greater contribution to the increasing value of pensions with those earning over £100,000 paying more".

Any changes arising from this consultation will take effect from April 2012.