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The cost of Britain’s recent political upheaval was revealed on Thursday when Treasury accounts showed the extent of severance payments made to ministers, advisers and officials in the wake of mass resignations and sackings last year.
The Treasury revealed that hundreds of thousands of pounds was paid to ministers who left after the exit of former premiers Boris Johnson and Liz Truss, even though some returned to government just weeks later.
Johnson received £18,660 as a severance payment after he was forced by parliamentary colleagues to step down as prime minister following successive scandals.
His successor, Truss, and her chancellor, Kwasi Kwarteng, received £18,660 and £16,876 respectively in severance payments when their government collapsed after just 49 days, precipitated by a disastrous mini budget.
Sir Tom Scholar, who was sacked by Truss as Treasury permanent secretary on her first day in the job on September 8 received £457,000 in compensation.
The removal of the experienced mandarin was meant to symbolise a new, pro-free market approach to running the economy from Truss.
However, she was forced to resign just six weeks later after her economic approach — involving large unfunded tax cuts — precipitated chaos in the bond markets, pushing up the cost of borrowing.
The Treasury annual report shows that Scholar’s total payments for the year 2022-23 were £540,000-£545,000.
That was a near-tripling of the figure for the previous financial year of £195,000-£200,000.
The extra pay-off of £457,000 — beyond his salary for five months — was made up of a £335,000 severance payment and £122,000 for “annual leave adjustments and compensation in lieu of notice”.
The sacking of Scholar last autumn was widely criticised, with former Tory chancellor Philip Hammond saying he was “alarmed” about the growing trend for incoming prime ministers to fire senior civil servants.
During a 30-year civil service career — including six years in the top job at the Treasury — Scholar worked on projects such as the independence of the Bank of England and David Cameron’s renegotiation with the EU.
A Treasury aide said the payment represented Scholar’s entitlement under the civil service compensation scheme, reflecting his seniority and the fact that he had worked at the department for 30 years. “That figure is what he was contractually entitled to,” he said.
The severance pay for ministerial special advisers increased from £99,000 in 2021/2022 to £2.9mn in 2022/23 in another symptom of the political mayhem of last year.
Ministers who took payments before bouncing back into government just months later included Grant Shapps, now energy secretary, and Michael Gove, now levelling-up secretary — who both took £16,876. Shapps gave “a pro rata portion” of his payment to charity, an aide said.
Chris Pincher, who stood down as deputy chief whip following accusations of sexual harassment and assault, received nearly £8,000 after he was suspended from the party last year.
Angela Rayner MP, Labour’s deputy leader, said the payments to departing ministers showed a “staggering lack of shame” when the general public were “struggling to pay their mortgages and put food on the table”.
Rishi Sunak received £17,000 in severance after he quit Boris Johnson’s government, but returned it to the government, the Treasury said.
