Civil servants fight for bonuses in pay shake-up

A pay shake-up in senior civil service salaries, including bonuses for high-flying performers, was introduced yesterday to woo people from the private sector to Whitehall.

Salaries of up to £180,000 can be expected by senior officials under a system that offers rapid promotion and bonuses for high-ranking civil servants.

But the introduction of performance-related pay will prove unpopular with the Whitehall old-guard, which is wary of Tony Blair's commitment to modernising the civil service.

From April 2002, senior civil servants will have to compete with their peers over pay, which will be "based upon an individual's contribution to their department's success". Those who do not thrive in the new competitive environment will not see their salaries rise and those working for under-performing government departments will be penalised.

The Cabinet Office said yesterday: "Pay awards under the new system will be directly based upon an individual's contribution to their department's success, relative to that of their peers. The better rewards are for those who perform well, based on the delivery of key objectives. However, they will be tough on those who contribute least. Poor performers can expect little or no annual pay increase."

The Prime Minister has been increasingly concerned by Whitehall's inability to attract managers from the private sector. A report by Sir Richard Wilson, the head of the Home Civil Service, in December 1999, recommended changes to be made to modernise Whitehall.

The new pay ranges will include four pay bands linked to market rates, for the most senior 3,300 civil servants.

The minimum salary of £50,000 for senior government employees including doctors, lawyers, scientists and policy advisers, rises to £105,000 a year with the bonus scheme.

Top performers among the civil servants already on a basic rate of £85,000 can expect an increase to £180,000.

The shake-up of the senior civil service means its performance will be judged according to a new "competence framework" based on leadership, delivery of results and the development of talent.