Taxpayers suffer while funding civil service perks

By Sam Packer, media campaign manager

The coronavirus emergency has hammered taxpayers. With GDP dropping by 20 per cent in April, millions more on the claimant count, nearly 10 million furloughed and overall pay suffering its biggest fall ever, swathes of the country face massive uncertainty and the real risk of significantly declining income. Against this backdrop, you would think top mandarins would be treading very carefully when it comes to their own pay and conditions in the public sector. But perhaps it is easy for them to forget, because after all, taxpayers’ money keeps them almost entirely protected from the economic damage facing everyone else. 

We often hear high pay in the public sector justified as being “necessary” based on comparisons with the private sector. But there has been much less noise about it being “necessary” for the public sector to follow the massive belt-tightening going on in the private sector at present. While the mayor of London has relented to our pressure and commendably taken a 10 per cent pay cut (after the publication of the TPA’s City Hall Rich List highlighted how well he and his staff are remunerated), such sacrifices have been few and far between in local and central government. For one, the mayor’s own TfL looks set to continue with its mega salaries, despite going cap in hand to taxpayers for a £1.6bn bailout.

Worse, several stories have emerged of public sector extravagance during the coronavirus crisis. Scottish government managers have won pay increases of 12 per cent, this week Kent county councillors have awarded themselves significant pay rises and most outrageously of all, the Department for Transport have put out a £30,000 tender for someone to design a “mindfulness” app for their staff, when at least five frees ones already exist on the major app stores! As our chief executive John O’Connell noted a few weeks ago, it is fundamentally wrong that private sector workers - who face the toxic combination of income loss, job cuts and a broader economic downturn - have to fund perks and pay treats for government workers that do not face the same. It must not be the case that as the country tackles this crisis, private sector workers take all of the pain whilst public sector workers gain. 

It may sound like a tricky balancing act. Suddenly sacking millions of hard working public servants for “balance” wouldn’t help anyone. It’s much more important to balance the books, and the best way to do that is to eliminate wasteful spending. If it’s not necessary, it’s not affordable. Unfortunately, there are plenty of examples where that’s the case. 

Today, we published the latest in our War on Waste series, pieces of research which look into areas of unnecessary spending. Appropriately, the newly published paper is on perks enjoyed by civil servants at a series of Whitehall departments. It shows that their generous salaries are topped up with perks like cycling schemes, subsidised canteens and holiday rollovers that simply would not be the case at their private sector equivalents. In one particularly shocking example, the Department for Work and Pensions spent the most on their canteen subsidy, clocking up £536,503 in 2018-19 at the headquarters site alone. People struggling to put food on the table should not be subsidising meals at DWP HQ. Given Britain's lowest earners lose almost half of their income in tax, paying for salary rises and perks like these is utterly alien to anyone not working in Whitehall. 

For Britain to bring spending down to manageable levels that would allow for significant reductions in the 50-year high tax burden, then wasteful perks are going to need to be eliminated. The coronavirus crisis, and the associated economic damage, make this particularly significant. With the public finances in dire shape and an economic slump around the corner, this is exactly the kind of wasteful spending taxpayers need stopped. 

As Britain emerges from this dreadful health and economic crisis, it is going to need to empower the economy by reducing enterprise-sapping taxes and allowing taxpayers to keep more money in their pockets. This will only be possible if the public finances are maintained, and unnecessary public sector perks are a great place to start. 


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