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Public Sector Exit Payments (Limitation) Bill

Part of the debate – in the House of Commons at 2:02 pm on 13th March 2020.

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Photo of Christopher Chope Christopher Chope Conservative, Christchurch 2:02 pm, 13th March 2020

I beg to move, That the Bill be now read a Second time.

The Bill is simple: it imposes upon the Treasury a duty to make regulations under section 153A of the Small Business, Enterprise and Employment Act 2015. You might think it extraordinary, Madam Deputy Speaker, that we have to legislate to require the Treasury to implement legislation that we in the House approved in 2015 and that I have been promised by numerous Ministers since is on the cusp of being brought into law. It has not yet been brought into law, and the consequence is that the taxpayer is probably about £1 billion worse off—the benefit to the Exchequer of the provisions in the Act was about £200 million each year.

It is against that background that I was very pleased to have a meeting with the new Chief Secretary to the Treasury. He has some background knowledge of this that dates back to before even I took an interest, because he was on the Public Accounts Committee when it looked at this issue in the early 2010s. The beginning, after the Committee had looked at it, came in January 2015, when the current Home Secretary, who was then a Treasury Minister, announced that it was intolerable that there were so many exit payments of such large sums. She called it a long-overdue reform and said:

“It’s not right that hard-working taxpayers, many on low salaries, have to fund huge payouts.”

As a result, after the Conservative election win in May 2015 the then Chancellor confirmed the commitment to legislate that was in our 2015 manifesto, saying:

“We will end taxpayer-funded six-figure payoffs for the best paid public sector workers.”

Then, in 2017, when nothing had happened, I had the temerity to ask the Chancellor of the Exchequer on 27 June

“when the Government plans to bring forward secondary legislation to implement the policy”,

and the answer I got on 6 July from the then new Chief Secretary, now the Secretary of State for International Trade, was:

“The Government announced in 2015 that it intended to end six figure exit payments for public sector workers. We legislated for a £95,000 cap in the Enterprise Act 2016 and are currently in the process of drafting the necessary regulations.

In the interim, the government expects every part of the public sector to demonstrate that it is using public money efficiently and responsibly and to ensure that pay and terms are always proportionate, justifiable and deliver value for money for taxpayers.”

Having received that non-committal reply, I asked more questions and then introduced a private Member’s Bill in the 2017-19 Session that was exactly the same as this one, except with different dates.