Press Release on LLG's Position to the Exit Payment Cap Regulations

Publish date: 27/10/2020

Like many lawyers, LLG are growing increasingly disturbed by the erosion of the rule of law, the nibbling away at one of the fundamental principles that underpins democracy. The disregard for proper process in parliamentary decision making, coupled with the undermining of parliamentary scrutiny, cannot solely be blamed for the need for fast-paced emergency decision making.

So, it is with reluctance that LLG has had to write to the government, along with colleagues at SOLACE and ALACE, to seriously question the flawed approach to legislation with respect to the imposition of the Exit Payment Cap.

LLG President, Quentin Baker said "Given the increased likelihood of redundancy in the sector the timing of this seems particularly pernicious. The implementation of the regulations is rushed and has created a genuine problem as the statutory instrument does not trump the pension scheme".

A rushed approach has meant that the legislation has come into force before the consultation on the LGSS pension scheme has even closed, leaving councils in a complex scenario where two regulations directly clash. Worse still, the Act does not allow retrospective changes, raising questions of lawfulness.

LLG question the rushed approach and lack of normal legislative process, allowing proper accountability through a consultation process, and scrutiny in parliament. This is not a 'covid 19' emergency fix, this is a permanent change in process and practice that is worthy of proper consideration.

Whilst long- serving local government employees, including senior lawyers & chief executives will be affected, there will be many other less well- paid roles which stand to have their exit payments reduced, because of the inclusion of the pension strain. This jars with the perception of fairness, as people have reasonable expectations stripped away at the most difficult of times. Local authority finance is tight, and restructures will most certainly be on the cards, and the purse strings are pulling tightly closed. With the current economic climate, many employees aged over 55 facing redundancy are in truth facing retirement, as prospects dwindle in a post-covid world.

A simple solution would be to exclude the pension strain from the calculation of the cap, or to at least delay the introduction of the cap until the pension consultation has followed proper process. Ian Miller, Honorary Secretary of ALACE stated, "We've pointed out consistently to the Treasury that pension strain should not be included within the exit payment cap and also drew attention to the problem that would be caused if its regulations were not aligned with any MHCLG amendments to the local government pension scheme. If the Government had listened, it would not now be facing this legal challenge"

It's a recurring theme, this erosion of scrutiny, as seen in the current call for evidence on the judicial review process. We are witnessing an ideological shift away from evidence- based decision making to knee jerk implementation and public accountability. This cannot be left unchallenged.

Quentin Baker emphasised "For us, this is about something bigger. It's about good governance, proper process, and the rule of law. We are holding the government to account and asking them to rethink".