Following on from my Armed Forces Pay Award Undervalues Military Personnel – commentary that I had written in late July I received a not surprisingly large number of positive responses. Thank you as always and rest assured that I will remain on the case for as long as may be required. I also received three extremely interesting responses that in effect implied that while we agree your stance why is it that you ‘bang-on’ about poor military pay whilst failing to mention the that senior civil servants who the military depend on to support them are, in comparison to both their military and private sector peers, very poorly paid as well?
It’s a fair point and one that I readily accept in the past I have failed to make a similar case for the thousands of senior civil servants and who we often regard as being the machinery of government. We need them and I am in little doubt that the ongoing ‘Integrated Foreign Policy, Defence and Security Review’ process has been made all the more difficult because the MOD has is recent years lost too many senior civil servants, particularly those with wide experience and who understand how the military system operates, to the private sector due to pay.
I suspect that if there was a reason why I have chosen to stay away from this particular ‘hornet’s nest’ it may well be because pay structures of civil servants have always appeared to me to be unnecessarily complicated and full of inconsistencies. Why for instance are external candidates for a new senior position offered considerably more to do the same job as that offered to an internal candidate?
Now, let me make it perfectly clear that I am no specialist in the area of either military or civil Servants pay scales but, along with what I have already written in respect of the military not being rewarded enough for the role that they play, I would also agree that senior civil servants and all those engaged in public services including the judiciary, police and those working in the NHS system are deserving a better deal in respect of remuneration for the extremely valuable work that they do as well. I will however here and now reserve my comments in respect of senior civil servants pay related to the defence sector.
Back in July last year, the 41st Annual Report of the Pay Review Body on Senior Salaries contained several references to anomalies and inconsistencies of pay and recommended that while pensions were outside of its specific remit the issue of “pensions flexibility should be examined as a matter of urgency with the aim of reducing perverse incentives that senior public sector employees may be facing”. Apart from recommending an increase in Senior Civil Service members pay, the pay body recommended that addressing lack of pay progression and the anomalies associated with this should also be regarded as a priority.
In researching the issue and noting that the Cabinet Office-led Government Commercial Organisation which has sole responsibility for directing pay bands of Senior Civil Servants (Director Gen, Director, Dep Director) it would appear that even those civil servants employed at a higher level of pay receive remuneration that is 20% to 30% lower than equivalent pay in the private sector.
An important point to make here is that during the several years that the oft called Cameron/Osborne ‘Austerity’ period lasted what little pay rise that civil servants received (not many did) was generally at or below inflation. I have yet to find a source of data to properly back this up, but my contention would also be that over the past ten years the pay gap between equivalent rank’s in the military and those of civilian staff has widened by a sizable margin.
Of course, the Civil Service is far from being considered perfect and there has been a huge effort put in over the past few years to weed out those considered to not be pulling their weight and that have poor skills and also to remove unnecessary layers within an overall structure – all in the name of improving overall efficiency. I proffer no criticism here at all – a good job well done!
Examples are many and when, under the leadership of Bernard Gray as Chief of Defence Materiel, the Bristol based Defence Equipment & Support (DE&S) organisation which has responsibility for MOD buying, went through a phase of radical shake up bringing to an end many time-honoured practices benefits began to accrue. That work has continued and while there are some who use and are forced to work with DE&S might regard the process of change as being work in progress in respect of making the organisation more efficient, there has in my view been a visible improvement.
I mention the above because it was Bernard Gray who argued that if DE&S could attract better staff and importantly, was able to both employ and retain the top people it needed by paying market-rates, everyone including the MOD would gain. Gray was losing the wrong people at DE&S because they had decided that they could no longer afford to work for the organisation. This is of course a complex problem and one that has been rife across many aspects of the MOD over the years. Gray believed that it was questionable whether DE&S, as the effective buyer of all MOD defence equipment, actually had enough skills and expertise to do the job arguing that the then existing pay structures combined with lack of flexibility meant that the ability to attract, retain, promote and motivate the kind of people that DE&S needed had become a very serious issue. I recall him say to me very clearly one day that “pay constraints can be a false economy”.
I have drifted away from the main point here – one that at senior and equivalent levels, some of the best civil servants that we have and who the military depend on are woefully paid when compared to both their military equivalents and also to their private sector comparators. Leaving pensions aside, worth noting to that whilst the military receive subsidised housing and where appropriate school fees and which are entirely appropriate, such benefit are not available to civil servants employed on military establishments.
A coherent defence system requires the combination of military and civilian personnel working alongside each other. All should be fairly and equally rewarded. On a like for like basis as far as I can ascertain the lowest grade civil of servant is actually paid more than his or her equivalent in the private sector but from junior management upwards they then begin to suffer a pay gap with private sector equivalents. That gap widens significantly for higher grades leading to the prospect of the equivalent pay in the private sector being up to 3 times higher.
All of this was made worse by the fact that the period of austerity led to a freeze on civil service pay and reduced pension benefits. Whilst it is also true that the powers that be also messed around with military pensions, on the basis of political expediency the main brunt of impact was aimed at civil servants. Pension changes in recent years negatively impacted on senior civilian and military staff leading to many deciding to leave rather than be promoted and then suffer increased taxation due to pensions – an issue that was in itself highlighted by the 2019 Senior Salaries Report.
CHW (London – 24th September 2020)
Howard Wheeldon FRAeS
Wheeldon Strategic Advisory Ltd,
M: +44 7710 779785