LLG warns on erosion of rule of law, attacks inclusion of ‘pension strain’ in calculation of exit payment cap

Commenting after it was announced last Friday that, together with SOLACE and ALACE, it had sent a pre-action protocol letter to HM Treasury over the making of regulations for the exit payment cap, the group said: “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.”

LLG said the decision to write to the Government had been taken “with reluctance”.

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.”

LLG argued that the Government’s approach meant that the legislation had come into force before the consultation on the LGSS pension scheme had 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.”

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The group said it questioned what it claimed was a 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,” it argued.

LLG maintained that whilst long-serving local government employees, including senior lawyers and chief executives would be affected, there would be many other less well-paid roles which stood to have their exit payments reduced, because of the inclusion of the ‘pension strain’ in calculating the cap.

“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.”

LLG argued that 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.

The group said: “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.”

Baker added: “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.”