The Scottish Government is consulting on possible changes to public sector exit payments in Scotland.

Those impacted would include local authorities, NHS Scotland bodies and further education institutions.

What is happening in the rest of the UK?

The UK government is planning reforms to public sector exit payments by:

  • Capping the total cost of individual exit payments at £95,000.
  • Those earning £80,000 or more will need to repay specified exit payments if they are re-employed in the public sector within 12 months - the amount will be tapered depending on the return date.
  • Reforming exit payment terms, including a maximum three weeks' pay per year of service and limiting employer-funded early access to pensions.

As things stand, these changes do not extend to the devolved Scottish public sector.

What options is the Scottish government considering?

The Scottish Government has indicated that it is considering the following options, and does not have a preferred approach at this stage:

  1. Retaining the status quo.
  2. Non-legislative change, via reforms to current devolved compensation arrangements.
  3. Replicating the UK arrangements described above.
  4. A hybrid approach, for example strengthening existing severance arrangements and / or introducing some form of different cap and / or recovery arrangements.

The consultation sets out the options and background information in detail and asks for input on a series of questions.

If you would like to respond you can do so before the consultation closes on 23 June 2017.


Kathleen Morrison

Practice Development Lawyer