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TSC hits out at £4m Money Advice Service redundancy payouts

The Treasury select committee has hit out at the £4m redundancy costs paid out to Money Advice Service staff last year.

Caroline Rookes
Caroline Rookes: At the Treasury select committee

MAS, which is the subject of a TSC sub-committee inquiry, has cut the number of full-time equivalent permanent staff from 150 in November 2011 to 66 in March and employs an additional 27 staff on an interim basis.

In its 2011/12 budget, the MAS revealed £4m redundancy costs, dropping to £250,000 for 2012/13.

Conservative MP Jesse Norman said: “Do you think there is something slightly odd about a service that is two years old having redundancy costs of £4m last year?”

The MAS was set up in April 2011 and all employees came from the Consumer Financial Education Body which was part of the FSA.

Redundancy payouts to MAS staff have been based on FSA redundancy policy, which awards staff who have been with the regulator for over six months and less than two years a sum equivalent to 13 weeks of basic salary.

MAS chief executive Caroline Rookes said: “The redundancy programme is complete. Most of the redundancies either took place or were agreed in the previous year.

“It was the nature of the service. I was not there but it was set up by taking an arm of the FSA. MAS has been through an enormous transformation programme to create the organisation we need and to deliver service and leadership to the sector.”

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  • City Boy 28th June 2013 at 10:56 am

    I am guessing this redundancy package was already in their contracts when they were employed under the FSA. When the came across to MAS they came across on the same terms and conditions on their original contracts. Poor show by the government, If these member of staff were that good they wouldnt be working for the FSA. Sounds like a gentlements agreement has taken place somewhere along the line!

  • The Sceptical One 27th June 2013 at 1:22 pm

    Why oh why were there terms that meant they got 3 months salary if they were given the elbow after 6 months? Most places you work offer one weeks pay for each year after two years service. Just another example of jobs for the boys and ridiculous benefits.

  • Tax Paying Broker 26th June 2013 at 3:00 pm

    No surprises – another example of government quangos lining pockets with public monies. No doubt they will all be applying for jobs back at the FCA too!