Cost of living: government pays civil servants millions in vouchers amid pay freeze and public sector strikes

The government has been accused of “rank double standards” after giving almost £30 million in high-street vouchers to civil servants - whilst also enforcing a pay freeze prompted by the cost of living crisis.

Sixteen Whitehall departments paid out a combined total of £29.57 million to civil service staff in 2021-2022, in the form of ‘reward and recognition vouchers’. According to departmental data provided by Labour, this is a third more than in 2020-2021, and two thirds more than in 2018-2019.

Accusations of hypocrisy have followed as the surge in the use of vouchers coincided with the imposition by then-Chancellor Rishi Sunak of a year-long pay freeze across most of the civil service in the wake of the coronavirus pandemic. It also comes as the government refuses to give out pay awards to striking nurses, using the argument that there is not the budget for it.

Commenting on the situation, shadow Cabinet Office minister Florence Eshalomi said: “No-one would dispute that hard-working civil servants deserve to be recognised for their efforts, especially those who went the extra mile during the pandemic, but once again, what we see in these figures is a Tory government guilty of rank double standards.

“At the same time that ministers are refusing even to discuss the subject of pay with our nation’s nurses, we now discover they got around their own pay freeze last year by giving out record numbers of non-cash vouchers to Whitehall staff instead.”

Most Whitehall staff received their rewards in the form of ‘Edenred’ vouchers and gift cards. These can be spent in a variety of high-street retail and restaurant outlets, such as Argos, Asda, Greggs, Iceland, John Lewis, M&S, Nando’s, Pizza Hut, Primark, TK Maxx, WH Smith and Wilko.

The biggest spender was the Foreign Office with £9.9 million, which was up 16.6% over the past four years. The Home Office came next, with £6.6m worth of vouchers, compared to £2.8 million in 2020-2021 and £1.2 million in 2018-2019.

Meanwhile, the Department of Work and Pensions secured third place with £5.9 million, a 15% increase since 2018-2019. And the Ministry of Justice took fourth place after more than doubling its £2.1 million from four years ago to £4.9 million.

Those who refused to provide figures for their voucher programmes were the Ministry of Defence, the Department for Environment, Food and Rural Affairs, and the Ministry of Health.

It comes as widespread industrial action from nurses, ambulance workers, Border Staff, rail workers and more continue to take over the UK. Prime Minister Sunak has said he is “sad” and “disappointed” about the strikes, but has insisted that refusing to negotiate is the “right thing” in the long term.

At the same time, food inflation last month hit a 45-year high of 16.4%. The Office for National Statistics (ONS) said the price of lowest-cost household essentials like pasta, tea and bread have all gone up in price significantly in the past year. This has led to pressures for many UK households who are struggling with rising food costs alongside soaring energy prices.

Analysis from the New Economics Foundation meanwhile suggests that some 30.6 million people – 12.5 million households and 43% of families across the UK – will not be able to afford everyday essentials, such as putting food on the table, by December 2024.