Why the Scottish government pays more than £2 million to 32 people to do nothing – Murdo Fraser
The SNP will need to face down the trade unions over compulsory redundancies if their public sector reforms are going to work
Public sector reform will be the defining issue of this new session of the Scottish Parliament, against the backdrop of the looming estimated £5 billion black hole in the public finances by the end of this decade. The Scottish government themselves are clear that significant savings have to be made, and with around half of overall expenditure being on salaries, that is going to mean staff reductions.
The SNP has set a target of reducing the public sector headcount by 0.5 per cent a year over the next five years, making a cumulative total of 2.5 per cent. The impact that will have on the delivery of public services, or indeed how far that will go towards filling the fiscal gap, remains to be seen.
The scale of the challenge cannot be underestimated. Under the SNP, despite promises to make the public sector more efficient, employment has continued to expand. Total public sector headcount rose by more than 6,600 in the last year, or 1.1 per cent. The total trend since 2018 has been upwards, with 553,600 employed in the public sector in June 2026, compared to 498,700 in June 2019.
These increases do not all relate to frontline public services. We have seen an increase in the number of core civil servants in the Scottish government of 2,300, or 34 per cent, since 2019. There’s also been significant growth in the workforces at Social Security Scotland, the Crown Office and Procurator Fiscal Service, and the Scottish Prison Service.
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A long-established principle
Reducing the public sector headcount will therefore represent a significant change of direction, but it presents the Scottish government with an additional challenge: how exactly will this be managed? The SNP has a long-established principle of not permitting public sector compulsory redundancies, which may not deliver the best outcomes for the public.
Speaking at Holyrood’s Public Service Reform Committee last week, David Philips, of the Institute for Fiscal Studies, questioned whether this policy could survive. He argued that headcount reductions through attrition would not deliver the scale of cuts required, and would also mean that individuals might be left in the public sector without the skills required for the future.
He gave as an example the need to increase the number of nurses, but also the number of software engineers and individuals who could help drive the use of technology in the public sector. It might not be possible to redeploy individuals currently employed, and therefore, in his view, the Scottish government might need to reconsider whether compulsory redundancies would be required.
The challenges presented by this policy are illustrated by the fact that there are 32 individuals within the civil service who have been placed on a so-called “priority movers list”. These are individuals whose jobs have effectively disappeared but cannot be made redundant because of the SNP’s policy, but effectively have no job to do. They remain in employment on full pay whilst they wait for another job to open up with the appropriate status and conditions.
The total pay bill for this group of 32 falls in the region of £2 million to £2.4m, to which has to be added employers’ national insurance contributions and other expenditure.
Edinburgh’s £437,000 bill
This issue is not restricted to Scottish government civil servants. The same challenge arises in local government, where, to give one example, Edinburgh City Council currently has nine workers on the city’s redeployment register, at a cost to taxpayers of £437,000 a year.
As Councillor Ian Whyte, Conservative group leader at Edinburgh Council, has observed, where those holding senior jobs see their positions disappear, it can be extremely hard for appropriate alternative roles to be found for them. These individuals cannot be forced to take voluntary redundancy, nor a demoted post, meaning that the council has to continue to pay them even though there may not be relevant work for them to do.
If this is happening already, the problem is about to get much worse without a change in direction from the SNP. The proposed reduction in the number of mainland health boards from 11 to two is likely to see a slimming down of senior management positions. Yet, the individuals currently holding these posts cannot be forced to leave, and there is a risk that they will simply add to the number on priority movers lists, effectively being paid whilst not performing necessary or valuable functions.
‘Denial, disorientation, resistance’
The Cabinet Secretary for Public Service Reform, Ivan McKee, told the Social Justice Committee last week that he anticipated pushback from those in the public sector to a reform policy. “We expect there will be bumps in the road, because people will go through the various stages of denial, disorientation, resistance, constructive input and so on,” he stated.
But there will also be significant resistance to any change in the no compulsory redundancy policy from trade unions, who will see this as a significant threat to their members. At last week’s Public Service Reform Committee meeting, Liam Davenport, industrial officer for the PCS Union, indicated that his members would be likely to take industrial action should there be any suggestion of a change in the redundancy policy.
That threat is a real one, but it is hard to see how anything like the number of savings that will be necessary can be achieved while the no compulsory redundancy policy remains in place. We will simply have to wait and see whether ‘Ivan the Terrible’ has the stomach to take on the public sector unions on this issue. If he hasn’t, the public sector wages bill will just keep going up and up, and that fiscal black hole will just keep getting deeper.
Murdo Fraser is a Scottish Conservative MSP for Mid-Scotland and Fife
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