Re-employed public sector execs to repay payoffs, says Treasury
Public sector executives who receive large redundancy payouts will no longer be able to keep the money if they return to a comparable sector job, the government has announced.
Danny Alexander, the chief executive to the Treasury, said the proposals would apply to individuals earning more than £100,000, who have received redundancy payments but are then rehired. If they are appointed to a post in the same part of the public sector within 12 months of leaving, the government would expect them to pay all, or a portion of the redundancy money, back.
The full amount will be calculated pro-rata depending on the length of time between exit and re-employment.
Alexander said: “It’s only fair that highly-paid executives who receive a redundancy payout from the public purse and then quickly return to the same part of the public sector repay the taxpayer.
“Reforming the public sector so it works for Britain has been a key part of this government’s drive to create a stronger economy and fairer society.”
The announcement comes after reports of employees in the NHS and local government who collected generous packages for leaving, but were then rehired within months.
Earlier this year, health minister Dan Poulter admitted during parliamentary questions that almost 4,000 NHS staff made redundant since 2010 had been rehired by various health service organisations.
A National Audit Office report in 2013 found that the cost of NHS redundancies was £435million with a fifth of those who left being rehired.
Jonathan Isaby, chief executive of the Taxpayers’ Alliance, told the Times: "The government is right to try and bring this lucrative revolving door to a halt.”
But Labour’s shadow chief secretary to the Treasury Chris Leslie called the proposals “too little, too late”.