Public sector pay strategy 2023 to 2024

Section 3: Pay, Workforce and Public Service Reform

The 2023-24 Pay Strategy strongly signals pay decisions are connected to workforce and reform to deliver top class, person-centred public services for the people of Scotland. The Scottish Government’s Resource Spending Review provides financial certainty in the medium term (to 2026-27), providing a platform and setting the conditions for achieving public service reform with a focus on improving outcomes for people, places, and communities across Scotland.

Pay and Workforce

For most public bodies, the pay bill is a significant element of their budget. Public bodies must satisfy themselves of the affordability and sustainability of the pay awards within existing budget allocations. As a result, bodies may need to consider the size and shape of the workforce to ensure affordability, alongside opportunities around, for example, digital reform, revenue generation, estates rationalisation and improved procurement. In some cases, pay awards may require public bodies to reform their operating models to remain within budget allocations and ensure fiscal sustainability.

Where a reduction in workforce is required, we would expect this to be through natural turnover wherever possible and we restate our commitment to No Compulsory Redundancies. In line with promoting mainstreaming of equality and Fairer Scotland considerations, individual public bodies must ensure their policies and practices and systems comply with relevant requirements.

Multi-year approach

To support employers in delivering wider Government priorities, the Pay Strategy includes the option for employers, in discussion with their Trade Unions, to take a multi-year approach to pay awards enabling them to support achieving public service reform, particularly with reference to delivering genuinely joined up, holistic, person-centred services. This allows employers to apply increases outwith the set metrics but within an overarching framework subject to affordability and sustainability.

Employers seeking to take this optional, public service reform approach to pay will be required to submit a comprehensive business case. More detail will be available in the Technical Guide.