No inflation relief for UK public sector

                                    

United Kingdom Chancellor of the Exchequer, Jeremy Hunt says Departmental budgets set in last year’s Spending Review will not be reduced. However, in-house spending will have to be reined in as soaring inflation has eroded their value.

The Chancellor used his Autumn Statement to set out plans for £55 billion ($A97.7 billion) in new savings over the next five years, largely through tax increases and spending restraint, although the National Health Service and the Department for Education will receive financial boosts.

He said Ministers planned to grow public spending, but would do it more slowly than in the rest of the economy to deal with a significant downturn in the nation’s finances, exacerbated by former Chancellor, Kwasi Kwarteng’s disastrous Mini-Budget in September.

“For the remaining two years of the Spending Review, we’ll protect the increases in Departmental budgets we’ve already set out in cash terms. Then grow resource spending at one per cent a year in real terms in the three years that follow,” Mr Hunt (pictured) said.

“Although Departments will have to make efficiencies to deal with inflationary pressures in the next two years, this decision means overall spending on public services will continue to rise in real terms for the next five years.”

Chief Secretary to the Treasury, John Glen and Minister for the Cabinet Office, Jeremy Quin have been tasked with running a new review to drive the efficiencies.

Director of the Institute for Fiscal Studies, Paul Johnson said proposals to increase public spending by one per cent a year from 2025 onwards would still mean cuts for unprotected Departments. 

He said freezing capital spending until 2025 was “of course a real terms cut” with inflation running at 11.1 per cent for the year to October.

General Secretary of FDA union representing senior Public Servants, Dave Penman said the Government could not disguise the reality of sticking to last year’s Spending Review settlements in the face of rocketing costs.

“The Chancellor has cut spending across all Government Departments in real terms until 2025. This will only lead to one thing — further pressure on vital services that the public relies upon,” Mr Penman said.

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Long running US legal action ends exams

The fallout from legal action begun 13 years ago has resulted in the American State of Massachusetts cancelling promotional examinations for firefighters and declaring recently held examinations for police null and void.

The case in question is Tatum et al v. Commonwealth of Massachusetts, a suit from several Black or Hispanic police officers filed back in 2009, which claimed the examinations disadvantaged minority test-takers, leading to lower scores and therefore delayed or missed promotions through the centralised and highly regimented process used by many police and fire departments.

Given the vagaries of the US legal system, the matter was not completed and a decision made until last month (October), when Judge Douglas Wilkins issued a blistering finding against the State Human Resources Division (HRD).

“The evidence is very clear. It defeats any justification for HRD’s heavy reliance upon biased examinations to identify the best candidates for promotion,” the judge wrote.

“Moreover, HRD knew of clearly superior assessment methods, but continued to use the same, unnecessarily discriminatory format anyway.”

The Judge said the massive amount of evidence proving the known and unjustified disparate impact of HRD’s format “leaves no doubt in this court’s mind that the Commonwealth has interfered with the plaintiffs’ rights to consideration for promotion to police sergeant without bias due to race or national origin”.

The examinations generally happen once a year, and one — already delayed due to unrelated issues — for Boston firefighters to become District Chiefs, was scheduled to happen later this month (November).

International Association of Fire Fighters Local 718 Head, Sam Dillon said his members “had the rug pulled out from underneath them”.

He said the postponement was part of a State move to get firefighters out of the State Public Service and the protections it affords.

“The State Civil Service Commission needs to go ahead with these examinations. This is a case about cops — I don’t see the relationship,” Mr Dillon said.

Professional Fire Fighters of Massachusetts Union head, Rich MacKinnon said his organisation had engaged an attorney to file an emergency order to “investigate this matter — specifically why the police case meant that firefighter exams have to stop”.

Meanwhile, the 2009 court case drags on with a further hearing to determine liability, and a second phase of the trial to see what the judge will order as a consequence of the new ruling.

That will not happen until 20 March next year.

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HK officials should be ‘neutral and patriotic'

Former Hong Kong Chief Executive, Leung Chun-ying has criticised the Government’s plan to remove a reference to ‘political neutrality’ from the Public Service Code of Conduct, saying neutrality should be a clear requirement.

However Mr Leung (pictured) said all Government employees must be patriotic and loyal to the country.

“Abandoning the expression of neutrality will only give ammunition to people who oppose us,” Mr Leung said.

He offered his own definition of political neutrality — “it means that Civil Servants cannot reject a task from supervisors based on their political beliefs, or only comply in appearance… it’s that simple”.

The former Chief Executive’s comments come after authorities announced that the term ‘political neutrality’ would be dropped from the Code of Conduct.

Addressing lawmakers at the Legislative Council, Secretary for the Civil Service, Ingrid Yeung said recent events and the international situation necessitated the change.

“The Code of Conduct should be updated to reflect the core values that Civil Servants should have,” Ms Yeung said.

Her address was her first to lawmakers since Chief Executive, John Lee presented his first policy address as Hong Kong’s leader last month.

Hong Kong employs around 175,000 Public Servants working across the various Government Departments. The city has recently seen an uptick in resignations among bureaucrats, with the number of people leaving their posts doubling from the previous year.

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Relief for US Public Service borrowers

In what might signal the end to the long-running saga of the Public Service Loan Forgiveness (PSLF) program, the United States Department of Education has announced permanent changes that will make it easier for borrowers to get relief.

Student loan borrowers pursuing this type of forgiveness can now get credit for partial, late or lump sum payments, or for payments made under a different repayment plan, as well as credit for periods in deferment and forbearance.

Announcing the changes, Secretary of Education, Miguel Cardona said his team had worked to turn Public Service Loan Forgiveness from a promise broken into a promise kept.

Established in 2007, the PSLF program allows those who work for the Government or specific non-profits to get their student loan debt cancelled after 10 years, or 120 payments.

However, from the start the path to forgiveness has been plagued with problems, making it hard to get relief.

The new changes will “reduce the red tape that riddled the PSLF program,” Mr Cardona (pictured) said.

Higher education expert, Mark Kantrowitz said before any changes to the PSLF were implemented only three per cent of borrowers who applied received loan forgiveness.

He estimated that number had increased to more than 17 per cent by September.

Mr Cardona said temporary changes to the PSLF had already helped more than 236,000 teachers, nurses, veterans, Government employees and other Public Service workers secure more than $US14 billion ($A21.6 billion) in debt relief.

“We are now introducing bold steps that will automatically move more hardworking Public Service workers closer to forgiveness and making permanent changes to reduce the red tape that riddled the PSLF program,” Mr Cardona said.

“We are as committed as ever to upholding the promise of the PSLF and ensuring borrowers who devote their careers to teaching our children, strengthening our communities, and serving our nation get the relief they’ve earned.”

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