Unions warn of public sector strikes on redundancy pay

Some civil servants have received payouts equivalent to six years' salary

Unions are warning of strikes after the government confirmed plans to change civil service redundancy payments.

One union leader called industrial action an "inevitability" if payouts to axed staff were to be reduced.

The government said the Civil Service Compensation Scheme would be reformed to bring it into line with "good practice" in the private sector.

PCS union chief Mark Serwotka said civil servants had "slightly" more generous conditions due to lower pay.

It had been thought unions were to meet ministers on Monday, but the PM's spokesman said no meeting had been scheduled.

'Economically illiterate'

Treasury figures suggest 600,000 public sector posts could go over the next five years, as the coalition tries to cut the record budget deficit.

Last month, the government lost a court battle over attempts to reduce redundancy payments, but unions fear emergency legislation could be brought in to reverse the ruling.

A Cabinet Office spokesman said: "As outlined in the coalition agreement, we are looking at ways to reform the CSCS [Civil Service Compensation Scheme] to bring it more into line with good practice in the private sector.

"Our intention would always be to seek to reach a negotiated agreement, which would include protection for lower-paid civil servants."

The Trades Union Congress is hosting discussions on what course of action to take at its headquarters in central London.

Ministers called the main civil service unions - also including GMB, Unite, Prospect, the First Division Association and the Prison Officers' Association - to a meeting at the Cabinet Office on Monday afternoon.

But this is expected to be cancelled and to be held on Wednesday instead.

Pay freeze

All the unions, except the Public and Commercial Services Union (PCS), have agreed to sign up to changes in redundancy, but the PCS represents about half of the civil service workforce.

Mark Serwotka, general secretary of the PCS, told the BBC that cutting jobs now would be "economically illiterate".

He said: "I believe there's no argument for any cuts in public services at all at the moment, that it would be a massive backward step that would throw up to a million more people on to the dole queue."

Mr Serwotka added: "They want to bring redundancy arrangements into line with the private sector but not do anything about pay.

"And the reality is about pay. The civil service is nearly 7% behind comparable jobs in the public sector and even more in the private sector, because the balance used to be [that] we got less pay but some of the other conditions were slightly more generous.

"This is about reducing those conditions whilst also giving us a pay freeze and doing nothing about the pay gap that has existed for decades."

He added: "If we get a tax on pensions and jobs and pay, I think that the inevitability of industrial action stares us in the face."

BBC political correspondent Gary O'Donoghue says the compensation scheme has in the past resulted in some payouts equivalent to six years' salary.

If agreement on reform could not be reached, ministers would have to amend the 1972 Superannuation Act, which established the redundancy rules.

Unions say letters have already gone to heads of human resources telling them they should not assume the status quo will last for more than the next couple of months.

It emerged at the weekend that Chancellor George Osborne had ordered most government departments to draw up plans for budget cuts of up to 40%, as they prepare for October's spending review.

Treasury sources have insisted it is only the start of the review process and that no department will face cuts on that scale, although it appears likely that some may lose a third of their funding.

It has led to fears that the scale of job losses could be larger than the 600,000 anticipated in Treasury figures.

Labour leadership candidate Ed Miliband criticised the government for engaging in "megaphone diplomacy" over cuts.

He told the BBC: "I don't actually think that is a very constructive way of going about making difficult decisions."

Cabinet Office Minister Francis Maude, the architect of the CSCS changes, is due to address senior civil servants about the government's approach at a conference on Tuesday.