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18 February 2021

Exit cap update

The regulations for the Public Service Exit Payment Cap (‘the exit cap’) were laid in late October and took effect from 4 November 2020. These regulations placed a limit of £95,000 on the total ‘exit payment’ that can be made when a public sector employee leaves their employment.

On 12th February 2021, after an extensive review of the application of the cap, the government concluded that there may be unintended consequences and these regulations were revoked. Therefore they're no longer in place.

There remains a long term commitment to ensure that public sector exit payments are fair and proportionate to employers, employees and taxpayers. HM Treasury have confirmed that they’ll continue working on new proposals. We'll update you when we know more about what these are.

Last updated: 19/02/2021