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Good work by Theresa.
Shocking from the MoD.

Why was Teresa asking these questions and not Liam Fox?

I am sure that some City slickers got more in individual bonuses than the entire staff of the MoD. What does that prove, other that the market applies to bonus payments?

Without context, the comparison is meaningless and smacks of petty political point-scoring.

What do you think the MoD penpushers are being rewarded for Richard?

Managing all those over-budget procurement projects?

Advising Des Browne to let the Iranian sailors sell their stories?

Ordering the wrong equipment for our troops?

It's always the same story. Bureaucracies always look after themselves.

The City slicker analogy is wrong because the same mark disciplines aren't operating.

A military operational allowance is not the same as a civilian performance bonus.

Soldiers just get medals.
Still, I suppose they could always sell them when they're stuck for cash, after risking their lives for us.

Alan S - you don't know any more than I do. The context is not given, which was the point I made. However, unless you are going to argue that the MoD - like any other ministry - does not have to compete in the jobs market, then it is hard to argue against a bonus system.

Whether the exact bonus levels are merited, neither you nor I know, but it is on the detail only, of individual cases, that you must make your judgement. For all you know, some of the bonus recipients were underpaid for the work they did.

As to the comparison, it has never been the case the soldiers are paid for the risks they take. To do so would turn them into mercenaries which, in a democracy, would be unacceptable.

Servicemen and women are volunteers - they join for a variety of reasons, not least because of the career opportunities and the challenges. Pay scales in part reflect this, but in the main are set by what is necessary to recruit sufficient numbers. That is the market at work.

On the broader point, would you suggest that a) MoD bonuses are reduced (and see an exodus of the best staff) or b) that service bonuses are increased - in which case where would that stand with Conservative spending commitments?

Definitely the latter (b) Richard. I 100pc support extra defence spending.

Definitely the latter (b) Richard. I 100pc support extra defence spending.

Posted by: Alan S | July 07, 2007 at 15:06

Is this from the same person who complained about the decisions made by MoD civil servants?

I do wish we could see a little more intelligence and subtlety to the defence debate. It has already been adequately demonstrated that throwing money at the NHS has not solved its problems.

Neither would, under the current circumstances, throwing money at the defence budget solve anything. As it stands, much of the money would probably go on shiny toys and very little on useful activities.

In that context, as long as we are committed to counter-insurgency operations in a peace-time environment, defence will always compete with other spending priorities. The real challenge, therefore, is how to maximise operational performance without breaking the bank.

Simple spending more would create strains elsewhere in the system - how long would it then be before we saw complaints about defence spending robbing little old ladies of their hip replacement operations?

In that context, substantial extra spending on defence (without any improvements in cost-effectiveness) could simply be a poisoned chalice. On the other hand, given the waste and the lack of cost-effectiveness, it remains to be proven that defence is underfunded.

You think are servicemen get paid too much do you Richard?

Easy solution. Just make it a requirement that all MOD civil servants must be members of the Territorial Army. It would soon all change.

You think are servicemen get paid too much do you Richard?

Posted by: Alan S | July 07, 2007 at 16:03

When The Times published the pay scale for L/S Turney, there was certainly some surprise at how much she did get paid, and not a few thought she was overpaid.

Do not forget that the REMFs get paid to the same pay scales as operational troops (as indeed does a half-Colonel driving a desk in the MoD) and some of then, I would warrant, are distinctly overpaid.

However, despite Mz May's interjection, pay is not by any means the main issue in the Armed Forces. Of far greater concern is the rapid turn round, allowing little respite between overseas postings. Thus, while recruiting is healthy, the forces are losing the more senior staff - who are actually quite well paid.

The losses are in part a result of over-stretch - but there are many other reasons.

What is especially significant though is that spend on equipment per capita is the highest of any Armed Forces in the world (higher even than the US), yet we consistently hear complaints of inadequate and insufficient equipment.

That points to underlying problems which are far more serious than Mz May's petty little jibe - ones which, unlike most other blogs, I try to address on mine.

I am sure that some City slickers got more in individual bonuses than the entire staff of the MoD. What does that prove, other that the market applies to bonus payments?

Dr North has developed quite a soft spot for MoD Civil Servants and especially Des Browne....one day he will let us into the secret.....

There is in reality NO reason for a Civil Servant to receive a bonus...they have job security, good pensions, and a life free from risk.......it might be that bonuses help politicise Civil Servants to be especially helpful to their political masters....it is corruption in essence unless Parliament approves the scheme and it is transparent and public

If it is MbO the Objectives should be published.....and those failing to gain bonuses should be considered for demotion

is that spend on equipment per capita is the highest of any Armed Forces in the world

Yes and Britain has the highest level of investment per unit of output in the industrialised world - way ahead of Japan and Germany and USA.........

That bizarre statistic proves only that Britain is inefficient and produces far less per unit of investment compared to successful industrial nations

And with the tiny Self-Defence Force Britain likes to call an Army spending so much money on grandiose projects it is obvious that it would have a huge capital spend per employee.....I did not say per soldier, because we know that there are only around 30.000 soldiers who could be called fighting infantry - and we took 55.000 casualties on 1st July 1916 on The Somme for comparison.

So putting 12000 men into Afghanistan and Iraq tends to make rotation very tight....never mind it enables the government to sell off the barracks while they are away !

We actually need less defence spending on systems, amalgamation of the RAF into the Army and Navy, and cross-national defence procurment as the overwhelming norm. The MoD is a Stalinist bureaucratic fantasy-world. That sort of set-up can prove expensive once fully-matured over the decades.

There is in reality NO reason for a Civil Servant to receive a bonus...

If it is MbO the Objectives should be published.....and those failing to gain bonuses should be considered for demotion

Posted by: TomTom | July 07, 2007 at 18:29

As always, this is "pub talk" of the highest order. Bonuses are part of the package for all senior civil servants (SCS) of all departments), many of whom are on fixed term contracts with no job security.

The use of bonuses is intended, amongst other things, as a cost-saving measure, transferring payments from pensionable salary into non-consolidated (that is non-pensionable) bonuses. Thus, salary increases have been held down over term, with bonuses as a proportion of the overall remuneration package increasing (currently 6.5% of salary).

See: http://www.civilservant.org.uk/pay.shtml

"Apart from saving money, bonuses are also intended to reward different behaviours to those rewarded by permanent salary increases. The key differences are as follows:

Salary is intended to reward an individual's value to the organisation and sustainable contribution as a member of the SCS. It should reflect size and challenge of the job; professional and leadership competence; an individual's market value; and track record of delivery in so far as that gives assurance of future sustainable performance.

Non-consolidated bonuses are intended to reward delivery of personal in-year business objectives or other short-term personal contributions to wider organisational goals.

Eligibility for bonus should be judged in relation to performance against agreed priority targets, total delivery record over the year, relative stretch of objectives, and response to unforeseen events which affected the performance agreement."

This issue has been widely discussed in Parliament and has been accepted as part of the modernisation of pay and conditions in the civil service, attempting to bring them in line with commercial practice.

You can argue whether the system is working, or whether it needs improving, but it really is a cheap shot to pick on the individual case in this manner.

If the old system applied and there were higher salaries but no bonuses, would that then be prefereable? It certainly would have deprived Mz May of her complaint.

A few questions here:

1) What were the average salaries of the civil servants and service personnel involved in this tale? Hence, what was the average bonus as a percentage of salary? I don't have any very strong prior either way, but my (weak) guess is that the average salaries of the civil servants is rather more than three times that of the soliers, and hence that their percentage bonuses are lower.

2) What is the intended function of bonuses in these contexts? Are they intended to incentivise the meeting of performance targets, or are they given as a reward for virtue. If the latter, when did we start rewarding virtue with money rather than medals?

3) How do the aggregate after-bonus pay packets of the civil servants compare with what they could secure in other jobs? How do the aggregate after-bonus pay packets of the soliers compare with what they could secure in other jobs?

I don't know the answers to any of these questions. Without at least this minimum information, I have no idea what to think of the point Teresa May is making (or indeed what that point even is). I might agree with her. I might not.

Pay peanuts - get monkeys

As always, this is "pub talk" of the highest order.

You spend too much time in pubs.

Those who fail to gain a bonus should be fired or demoted, but this is not possible in the Civil Service. Bonuses do not work well in unionised environments and are more common in positions with individual contracts or service agreements.

I understand that 50% of senior civil servants have in recent years left before age 60

How droll - very few private sector managers survive to 55...and very few retire on such generous packages as Civil Servants and there is no Rule of 85 in the private sector where the retirement age has been raised to 68 years.

The Senior Civil Servants are not of a calibre anyone in the private sector would want they lack commercial skills as is evidenced by their signal failures in procurement whether of computer systems for IT Projects or weapons systems or even office space. They are regarded with contempt by major commercial organisations.

Interesting criteria for bonus awards



Foreign Office

Foreign Office staff have enjoyed £24million in bonuses over the past five years, it has been revealed.

The figures reveal that 5,097 Foreign Office officials received bonuses of up to £25,000 each last year. By contrast most junior soldiers in Iraq earn £39.34 a day. As many troops are asked to be on duty for 12 hours a day, it means they are earning less than the minimum wage of £3.30 paid to 17-year-olds.

MoD Bonuses

Friday 6 July 2007


Bonuses for MOD civil servants
A newspaper reports factually that MOD civil servants can receive bonuses for high performance. Last year a total of £41million in performance bonuses was paid to eligible civil servants in MOD, of whom there were just over 71,000.


and as the GLA Document indicates the real reason for bonuses within the Civil Service was to sever the link between the Senior Civil Service and other Public Sector Employment as used by the Senior Salaries Review Board when setting pay for MPs, Judges, and people like the Mayor of London

1. Employ monkeys

2. Pay peanuts

Apart from anything else your cannot make valid comparisons between the pay of junior soldiers and senior civil servants - you are not comparing like with like.

The very fact that you are making so many points, and indeed that they are arguable, proves my point. Mz May's comments smack of petty political point-scoring.

Not much traffic on your blog Richard?

"Not much traffic on your blog Richard?

Posted by: Perdix | July 07, 2007 at 23:04"

Even I don't mind slumming it occasionally!

Having read this exchange with some interest, I think Richard North has had the better of the argument and I draw that conclusion most of all from some of the documents to which TomTom kindly provided links. There is clearly nothing exceptional about the MoD scheme - it is part of a system across Whitehall whereby bonuses have been introduced for senior civil servants. As gleaned from above and from the linked documents, at the moment these are set as 6.5% of their overall salary bill - they only started in 2002, have a minimum (when paid I think, rather than for everyone, but not certain of that) of £3,000 (this is on a min salary level for the seniority involved of about £55K, although the average would be much higher), and are intended to increase to 10% of the total salary bill over the next few years.

Whether introducing this bonus system is a good or a bad thing is a matter for debate. It is probably not widely known, so to that extent Theresa May may have done a service. But the juxtaposition of these senior MoD bonuses with soldiers' operational bonuses is spurious. Is it being suggested that MoD senior civil servants are likely at present to be having less demands put on them than usual because we are fighting two wars? Or that they are having less demands than civil servants in other departments? In both cases obviously no. So the only legitimate attack is on the whole new system, not on the MoD.

Whilst there are some features of this scheme that seem odd, and would not apply in the private sector, such as having a set bonus pool however the organisation as a whole is doing, I should think it would generally be thoroughly in the public interest to have senior civil servants incentivised with bonuses - and, more particularly, in the interests of any Government, including an incoming Tory one. Indeed the previous Tory Government introduced a very modest measure of performance related pay all down the civil service, but this was abolished partly because the unions didn't like it (incidentally TomTom the senior civial service is not strongly unionised - many are not members of the First Division Assn and that body in any case rarely acts much like other Trade Unions).

If Theresa May wants to end these senior civil service bonuses, she's either going to have to consolidate much of them into base pay (hardly prudent or sensible) or have to put up with an extremely frosty welcome from these people when she wants their help to implement our programme after the election.

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