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Jonathan Baume, FDA General Secretary, said:

"Senior managers in the civil service and wider public sector face the prospect of significant increases in their pension contributions, following the Chancellor's announcement today of additional savings of £1.8 billion in pension costs by 2014-15. In 2005 FDA members voted for strike action when the then Labour government tried to impose changes to pension arrangements without negotiations and agreement. The Government has listened to our arguments and refrained from making any pre-emptive decisions about the scale of such increases pending publication of Lord Hutton's final report. They must also ensure there will be comprehensive negotiations with the FDA and other public sector unions following Lord Hutton's final report before any changes are implemented.

"Pay is currently frozen and senior public servants are facing a long-term reduction in their living standards, with rises in taxation and the withdrawal of universal benefits. There is a real danger that the overall remuneration package may be cut by changes to pensions to such an extent that the Government and other public sector employers will struggle to recruit and retain senior managers and professionals. These are people whose skills and dedication are essential to ensure the effective delivery of public services across the UK.

"The Government has also announced potentially significant reductions in the number of civil servants employed across all government departments. However, it will not be clear how many jobs will go, or at what levels the cuts will bite - nor the potential for compulsory redundancies - until the departmental business plans are published over the next month.

"Morale will suffer at all levels of the civil service whilst individuals wait to learn about the impact on their future employment and the services they provide. Senior managers have a particularly difficult task in seeking to maintain the morale and motivation of the teams they manage, and in ensuring that services continue to be delivered to support ministers and the wider public, at a time when their own posts are also under threat. The FDA will be seeking urgent discussions with all government departments about the impact of today's announcement."

Notes for editors:

1. The FDA is the trade union and professional body representing 18,000 of the UK's senior civil and public servants. Our members include policy advisors, senior managers, government lawyers, tax inspectors, economists, statisticians, accountants, special advisers, diplomats, crown prosecutors and NHS managers.

2. The FDA (formerly the First Division Association) should be referred to simply as "The FDA" and can be described as "the senior public servants' union".

3. For further information contact:

• Jonathan Baume, FDA General Secretary, tel: 020 7401 5555 or 07976 951191.
• Oliver Rowe, FDA communications manager, tel: 020 7401 5588 or 07590 838696.