Should severance pay for ministers be reformed or scrapped?

Rayner Severance Payment: – Unfair or justified?

Ever wondered what happens to a cabinet minister’s pay when they lose their job? Whether resigning, being sacked, or shuffled out of a role, the severance packages they receive are eye-watering, far beyond what most of us could imagine. The Chart included in this article is a striking insight into the rewards of political office.

Please discuss this article with a colleague, a friend or your family, the WEU knows it will be a guaranteed conversation starter!!

When ministers leave government

When ministers leave government, they do not walk away empty-handed. Under the Ministerial and Other Pensions and Salaries Act 1991, anyone under 65 leaving ministerial office is entitled to a severance payment, officially called a “loss of office” allowance.

The sum is fixed: one quarter of the annual ministerial salary. For a Cabinet-level post, this works out at around £16,876. Importantly, this is separate from an MP’s parliamentary salary, which continues if they remain in the Commons.

This entitlement applies whether the minister resigns, is sacked, or loses their role in a reshuffle. It is automatic, unless specific conditions are triggered. The rules also state that the payment can only be made once per Parliament, and if the person is reappointed within three weeks, the money may have to be repaid.

The Bigger Picture

Over the years, the system has attracted scrutiny. During the turbulent Johnson–Truss era, the churn of ministers meant the Treasury paid out close to £933,000 in severance payments in a single year (2022–23).

Some payouts were particularly controversial: Kwasi Kwarteng received £16,876 after just 38 days as Chancellor, while Liz Truss and Boris Johnson each walked away with nearly £19,000.

Other examples show the same problem. David Blunkett received £18,215 after resigning, only to return to Cabinet five months later. Alan Milburn received payouts more than once, increasing his total. Brandon Lewis received the highest combined sum, reportedly £33,752 across two roles.

Top Individual Severance Payments (Known Cases)

Source: House of Commons Library, The Independent, The Guardian, The Times and different media outlets

Recent Reforms

In July 2025, reforms tightened the scheme:

• Ministers serving less than six months must now forgo severance.
• Ministers reappointed within three months must return any ministerial salary they receive until three full weeks have passed.
• Ministers leaving office due to a serious breach of the Ministerial Code or post-government lobbying rules are expected to forgo or repay the payment.

The new Ethics and Integrity Commission is also set to reclaim severance payments in cases of misconduct.

The Rayner Case

Angela Rayner’s resignation as Deputy Prime Minister has reignited the debate. She is entitled to the standard Cabinet-level severance of £16,876. Conservatives argue she should decline it, noting she previously voted in opposition to block payouts for ministers under investigation. Kevin Hollinrake, Tory Party chairman, claimed:

“If she has any integrity, then surely she must decline any severance payment.”

Rayner’s personal finances have also become political ammunition, but the real issue is not her case alone: –

it’s whether the principle of ministerial severance pay is ‘justified’ at all.

The Question for WEU members

For WEU members, the contrast is stark. Redundancy pay-outs in ordinary workplaces are often fought for, capped, or withheld altogether. Few workers can expect four-figure “golden goodbyes” after just weeks in a job.

Should politicians enjoy an automatic cushion unavailable to those they represent?

Angela Rayner’s £16,876 is a small slice of a much larger system. Her case forces us to ask:

Should severance pay for ministers be reformed or scrapped entirely?