A former civil servant missed out on a year's worth of redundancy compensation due to her age despite having been four years away from the state pension age.
Lucinda*, 65, was impacted detrimentally by a “discriminatory” pension rule linked to the Civil Service Compensation scheme.
Despite having been a civil servant for nearly 20 years, she lost a year's worth of redundancy compensation due to her age.
She was made redundant from her HMRC role at the age of 62 in December 2021, while caring for her partner before they passed away.
Under current rules, someone aged 59 years and 11 months can get up to 21 months' pay, with each month in recognition of each year they work in the civil service.
However, there is a cap of six months' compensation for people who are 60 or older, whether their redundancy is voluntary or compulsory, as they will be considered close to pension age.
Do you have a money story you’d like to share? Get in touch by emailing money@gbnews.uk.
Civil service redundancy rules are penalising older workers
GETTY
Having turned 60 in 2019, the amount of compensation Lucinda received was capped at six months instead of the upper cap.
She says someone aged 59 years and 11 months getting significantly more than someone just a month older is an example of “age discrimination”.
Speaking to GB News, Lucinda said: “They have reduced the payment over the age of 60 because you are nearest to qualifying for the state pension, which they keep putting further away.
“It was absolutely soul-destroying. I started to work for the civil service in 2002. They talked about closing the office for five years before it actually happened.
“I really got quite angry when I realised that I don’t get the full compensation just because I’m 60, even though I have another six years before I can get my state pension - which the Government has pushed back.”
Lucinda is set to get the full state pension amount once she turns 66 next year and has a pension through the civil service.
However, she believes it is unfair for older civil servants to get less in redundancy payments than younger counterparts, particularly as people face working longer as the state pension age is rising.
In August 2022, the Civil Service Compensation Scheme defended the decision to taper redundancy payments for those aged 60 or older.
The scheme stated: “We do not believe that it is discriminatory. The purpose of the scheme is to provide a proportionate financial cushion to those who lose their jobs.
“There is less need for that financial cushion when an employee is able to draw a pension during the time they are looking for new employment.”
LATEST DEVELOPMENTS:
Older workers facing redundancy may still many years to wait until reaching state pension age
GETTYAs well as being recently widowed, Lucinda has struggled with her own health issues which has led to claiming disability benefits.
She explained: “I think the Government needs to look again at the decision that when you’re 60, compensation is a third of someone else’s who is 59 years and 11 months old.”
Noting the success of the WASPI (Women Against State Pension Inequality) campaign, Lucinda hopes more attention will be drawn to older civil servants who are being made redundant and forced to live on less than they have earned.
“What might make it better is if there was realistic compensation for everyone who comes under the umbrella of being born between 1950 and 1960, like the WASPI women. I don’t think anything is going to help me, to be honest,” she said.
A Government spokesperson told GB News: "Exit payments are sometimes necessary when departments need to make important organisational changes. While we understand each individual's situation, it is vital that payments are fair, proportionate and achieve value for money for the taxpayer.
"The maximum amount an individual can receive reduces in the months before they reach pension age in recognition of the fact they may soon claim their full pension."
