The Superannuation Act 2010 (c. 37) is an Act of the

Parliament of the United Kingdom The Parliament of the United Kingdom is the supreme legislative body of the United Kingdom, the Crown Dependencies and the British Overseas Territories. It meets at the Palace of Westminster, London. It alone possesses legislative suprema ...

. It caps the redundancy payouts to civil servants at 15 months' salary. Initially the proposal was for a maximum of 12 months' salary. This was raised during the passage of the Bill to 15 months in the case of voluntary redundancy. It was introduced in the

House of Commons The House of Commons is the name for the elected lower house of the bicameral parliaments of the United Kingdom and Canada. In both of these countries, the Commons holds much more legislative power than the nominally upper house of parliament. ...

on 15 July 2010, and received its third reading there on 13 October. The Act was given Royal Assent on 16 December 2010 and passed into law. There had been considerable political controversy surrounding the Act and its provisions and it was considerably amended during its passage through parliament. Under the previous Civil Service Compensation Scheme (CSCS), civil servants received, on average, redundancy pay-offs equivalent to three years' pay, with some senior civil servants eligible for

severance package A severance package is pay and benefits that employees may be entitled to receive when they leave employment at a company unwillfully. In addition to their remaining regular pay, it may include some of the following: * Any additional payment base ...

s worth six years' salary.

Cabinet Office The Cabinet Office is a department of His Majesty's Government responsible for supporting the prime minister and Cabinet. It is composed of various units that support Cabinet committees and which co-ordinate the delivery of government objecti ...

minister

Francis Maude Francis Anthony Aylmer Maude, Baron Maude of Horsham, (born 4 July 1953) is a British Conservative Party politician and life peer who served as Minister of State for Trade and Investment from 2015 to 2016, having previously served as Minister ...

described this as completely "untenable" and "massively out of kilter with the public sector", and said that the Act's effort to cap these redundancy payments was "an inevitable consequence of current economic circumstances". Mark Serwotka, general secretary for the

Public and Commercial Services Union The Public and Commercial Services Union (PCS) is the sixth largest trade union in the United Kingdom. Most of its members work in UK government departments and other public bodies. History The union was founded in 1998 by the merger of th ...

, said that "the government wants to lay waste to our members' jobs and livelihoods more cheaply". Legal challenge in Europe was also threatened. The dispute over redundancy payments is long-standing, and under previous rules, in order to change the CSCS an agreement was needed with all six civil service unions. The Superannuation Act 2010 amended the

Superannuation Act 1972 A pension (, from Latin ''pensiō'', "payment") is a fund into which a sum of money is added during an employee's employment years and from which payments are drawn to support the person's retirement from work in the form of periodic payments ...

, in order to limit redundancy payouts and to end the absolute requirement for an agreement with trade unions in relation to redundancy payments. The Act was hardly in place before the maximum figure for redundancy payouts was repealed and higher levels announced. In a written statement on 21 December 2010, Francis Maude advised parliament that we "are now in a position to be able to repeal the caps set out in the Act through the Superannuation Act 2010 (Repeal of Limits on Compensation) Order 2010, which comes into force today. The repeal means that the statutory caps of a maximum of 15 months' pay for voluntary departures and 12 months' pay for compulsory departures, will not apply to the new civil service compensation scheme that is starting on 22 December 2010." The key elements of the final compensation scheme for voluntary redundancy, if below normal pension age (either aged 60 or 65), were for one month's pay per year of service up to 21 months (previously 15 months) with a taper of between a maximum of 21 months' and six months' compensation for those approaching pension age, and for those at or above normal pension age, one month's pay per year of service up to a maximum of six months.

References

{{UK legislation United Kingdom Acts of Parliament 2010 Civil Service (United Kingdom) Pensions in the United Kingdom

See also

References