Union to fight Civil Service payoff blow

The Government is facing growing anger over plans to cut compensation payments to civil servants losing their jobs.

The Public and Commercial Services Union warned it would use "all means" at its disposal to resist moves by the coalition administration to target payments to public sector employees who were laid off.

The union won a High Court case against the previous Labour government which tried to reduce compensation pay, but Ministers are believed to have drawn up plans to introduce new legislation which would overcome the legal ruling.

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The Cabinet Office confirmed that Ministers intended to go ahead with reform of the Civil Service Compensation Scheme to bring it more in line with the private sector.

The move follows the disclosure at the weekend that Chancellor George Osborne ordered Government departments to draw up plans for budget cuts of up to 40 per cent as they prepare for the spending review in October, with predictions that more than 600,000 public sector jobs could go in the next five years.

An announcement over the details of the move could be made today.