Enterprise

Written evidence submitted by Sean Kelsey (ENT 42)

1. I am writing with reference to the proposed cap on redundancy payments for public sector workers in the Enterprise Bill currently before the Public Bill Committee. I am a Magnox Limited employee based at Hinkley Point A with over 28 years service .

2. Magnox Limited employees are employed in a unique nuclear power station closure programme that requires their committed input to ensure that safety and compliance is upheld until all the sites are placed in Care & Maintenance. Magnox is essentially a shrinking company in line with the closure programme of nuclear sites. There is a shortfall of skills in nuclear decommissioning and Magnox’s staff commitment to see the programme out was identified as being essential early on in the closure programme. This commitment has been obtained and maintained through a number of arrangements:

· The Lifetime Partnership Agreement, signed by my employer and its recognised trade unions in 2002 which sets out Redundancy and Severance Terms.

· Magnox staff employed pre-2011 have a Protected Reference Severance Value in writing.

· The Electricity Supply Pension Scheme allows for pension to be paid at 50 for staff made redundant who were employed pre-February 2003.

· The 2004 Energy Act provides protection for Pensions and states in Schedule 8 Part 2 (7) - The modifications of a pension scheme that may be made under this paragraph do not include modifications that would, to any extent, deprive a member of the scheme of pension rights that accrued to him under the scheme before the coming into force of the modification.

3. Furthermore, any redundancy under the severance terms has to demonstrate a cost benefit.

4. I am deeply concerned around the timing of this Bill at a time when Magnox are looking to make redundant 1000 staff. Estimates of (pre-cap) redundancy packages have already been issued. Nuclear new build will provide extremely attractive employment opportunities for current decommissioning staff and retention of these skilled personnel will be very difficult with an exit cap in place.

5. Personally I would be affected by the proposed cap. It will mean that when I am made redundant I will not receive my accrued pension from the age of 50. Early access to my pension has been a significant driver in my continuous service with Magnox. Without this agreement it is very likely I would have left to pursue an alternative career with more longevity and career prospects.

6. Whilst I enjoy my job and working for Magnox I have made the difficult decision to apply for voluntary redundancy. This was greatly influenced by the possibility of a cap being applied. Many others in my position are applying for this option. This will inevitably lead to a shortfall in key decommissioning experience. The precise personnel that all the previous protections were put in place to ensure Magnox retained key staff are being driven out by the proposed cap. Loss of key skills will lead to contractorisation of the workforce, increased scrutiny by the Regulators, inevitable delays and escalation in costs.

7. To prevent this, I would suggest the following, either:

Include Magnox Limited in the list of exempt bodies

Or

Include a clause that excludes any public sector employee with over 10 years continuous service. It appears that those with longer service are disproportionately affected by the cap and thereby excluding these would prevent this unfairness. It can clearly be argued that any employee who is willing to put in 10 years service is not in their job just to obtain a pay-out. I would recommend modifying Page 50, Part 8, Clause 35, lines 14-16 to:

(1) Regulations may make provision to secure that the total amount of exit

payments made to a person, with less than 10 years continuous service in a public sector body, in respect of a relevant public sector exit does not exceed £95,000.

8. I would also like to take this opportunity to respectively point out that every Magnox employee in a negotiated grade, referred to as ‘fat cats’ in the Enterprise Bill Second Reading by Sajid Javid earns considerably less than the Secretary of State for Business, Innovation and Skills and that the vast majority of Magnox employees in negotiated grades, including myself, earn less than a serving MP.

February 2016

 

Prepared 18th February 2016