Labour has pledged to overhaul the rules governing ministerial redundancy payments after it emerged that the high turnover of cabinet ministers under the past three prime ministers generated a severance bill of more than £930,000 in the last financial year. Shadow Cabinet Office Minister Jonathan Ashworth said the current system allowed individuals who were never fit for office to walk away with taxpayer-funded payouts.
Under existing rules, sacked ministers under 65 can claim thousands of pounds in redundancy pay after being out of a ministerial post for at least three weeks, regardless of how long they served or the circumstances of their departure. Labour proposes three changes: calculating payouts based on a quarter of actual ministerial earnings over the past 12 months rather than final salary; clawing back payments from MPs who return to ministerial roles while still receiving severance; and suspending payouts for ministers under investigation for misconduct, with full forfeiture if allegations are upheld.
Labour claims its reforms could have reduced the £933,086 severance bill from the last financial year by more than 40%, to £555,093, and cut the number of payments from 98 to 76. The party highlighted cases including Chris Pincher, who received £7,920 after resigning as deputy chief whip in 2022 amid groping allegations, and Peter Bone, who was given £5,593 after stepping down following a misconduct finding, despite being over the age limit for such payments.
Other examples include Brandon Lewis, who received two payments totalling £33,572 in four months after leaving his roles as Northern Ireland secretary and justice secretary, which Labour says would have been cut to £13,594. Rehman Chishti, who served just two months as a Foreign Office minister, would have seen his payout reduced from £5,593 to £936. The party also noted that five frontbenchers were handed payouts in error due to age limits not being enforced, including Nadine Dorries (£16,876) and Deborah Stedman-Scott (£17,742).
Ashworth said: 'We saw individuals who were never fit for ministerial office in the first place being forced to quit after their shameful conduct was exposed but still walking away with a payout from the taxpayer. Under the current rules, every single one of those Tory ministers was legally entitled to three months of severance at their final-salary level, no matter how long they had been in post, no matter the circumstances of their departure, and – in most cases – no matter how quickly they returned to the frontbench. These are the glaring loopholes that Labour’s proposed reforms will seek to close.'
