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Public sector exit payments: consultation on new administrative controls

In February 2021, the public sector exit payment cap was revoked, less than four months after it had come into force. However, the government’s wider ambition remains to reduce the use of large exit payments in the public sector, so HM Treasury has now launched a public consultation Public Sector Exit Payments: a new controls process for high exit payments, which outlines its proposals to introduce a new administrative controls process for public sector exit payments. The consultation closes on 17 October 2022. Draft guidance proposes two separates, but closely related, control processes for exit payments: (1) a new control process for high value exits in central government, where approval from the relevant Secretary of State must be sought before an exit is agreed; and (2) a modified version of the current system for the approval of special severance payments.