Westminster blog

I am told by a reliable source that ministers have struck a deal with five out of the six civil service unions over the civil service compensation scheme. (The PCS* are apparently still holding out but its national executive is meeting this afternoon to discuss the offer). An announcement is expected as early as today.The deal could pave the way for the coalition to cut redundancy terms for civil servants and lay off up to 100,000 jobs out of the 500,000 covered by the scheme.

Francis Maude, cabinet office minister, is currently legislating for the new arrangements via a parliamentary bill which has its third reading next week. He has wanted to reduce the cost of making civil servants redundant by about two-thirds, claiming the current scheme is “way out of kilter” with the private sector.

The complication was that Labour was already committed to reducing pay-offs and announced its own scheme at the start of the year – but this was successfully challenged in the courts by the PCS. Then Mr Maude came up with his own, even tougher plan (announced here in July) to be pushed through via the bill.

I’m told that the new agreement offered to the Council of Civil Service Unions will mean a cap on voluntary redundancy payments of 21 months plus a three-month notice period – basically the equivalent of two years (which is what Labour had proposed at the start of the year). It is more generous than the 15 month cap that Mr Maude was hoping to achieve. For those leaving under compulsory redundancy the payout is just 12 months, also with a three-month notice period.

There will also be some protection for those earning under £23,000, I’m told.

What is likely to happen is that the new agreement will be inserted into the bill via a new amendment which will stop the unions complaining about the changes. Yet I’m told the government does not have a fresh figure for how much it will save through the deal – which would be a very useful detail to know. And without the PCS agreement does the agreement count for anything?

* The PCS is double the size of the other five unions in terms of civil servant membership.

UPDATE: There are more details over at the Civil Service Live network site. It reports that Francis Maude is still hoping to reach a deal with all six unions.

UPDATE: 3.30pm. The Cabinet Office has confirmed the story. Maude spoke to Mark Serwotka, general secretary of the PCS today, and asked him to come back to the table. Apparently he didn’t get a very positive response.