On 21 May the Cabinet Office published the 2026 Civil Service pay remit. The purpose of the remit is to set the constraints that government departments must stay within when developing a pay offer for our members. The headline figure of the pay remit is a 3.5% increase to the pay bill.
PCS agreed at Annual Delegate Conference in May 2025 and reaffirmed in May 2026 pay demands that include a rise of at least 10% consolidated (meaning it counts towards pension) rise and a minimum wage of £18 per hour. This is to reverse the years of wage stagnation inflicted on us in the name of ‘austerity’.
Our 10% demand is about putting our members back in the position we should be. The rate of pay for an AA in HMRC in 2007 was £15,115. Had their pay kept pace with inflation, an AA would currently be on £30,432. For comparison 10% pay rise in 2026 for an AA would put them on £30,653.
This remit is not enough
Inflation is predicted to rise throughout 2026 due to global factors including the ongoing war being conducted by the USA and Israel on Iran and Lebanon. A pay rise equal to the maximum 3.5% will be swallowed up by rises to council tax, energy, food, transport and so on. Our members won’t feel any richer from a 3.5% remit.
It’s become a regular feature of the pay remit that departments can make ‘pay flex’ cases. This involves the department making a business case for using more than the 3.5% remit in developing a pay offer. A new type of pay flex case this year is the ‘Pay Compression Framework’.
Pay compression refers to the way that the minimum wage has risen faster than our pay, so that AAs and AOs have ended up with their pay being practically identical. It also means AA/AO pay has been catching up to the Officer pay range. Departments who choose to use the framework can introduce a 5% differential between AA and AO, and between AO and Officer.
The reference to 5% is eye-catching, and at first glance some members may think this is in addition to the 3.5%. Any members thinking they could get an 8.5% pay rise would be forgiven for taking a favourable view of this remit. But the detail shows 8.5% simply isn’t on offer.
A department must show why they can’t afford to introduce the differential from the existing 3.5% remit, and the business case will only be for the costs that can’t already be met. The Framework can only be worth around 1.5% more pay to our AO and Officer members. Our demand for 10% is nowhere close to being met by this remit.
Lessons from HMRC: don’t accept strings attached
Back in 2020 HMRC proposed a package pay offer that was linked to giving up terms and conditions. This was called ‘Pay and Contract Reform’. HMRC and some of the leadership in PCS sold PACR on the basis it would put substantial pay in the pockets of our members after years of pay restraint.
At the same time the strings attached to PACR were deliberately ignored or downplayed to make sure the offer was accepted by members. It was only a limited number of reps – including members of the Broad Left Network – that warned of the dangers of PACR.
Sadly, what we warned of has come to pass. The pay that was bought by surrendering terms and conditions has slipped back to being minimum wage. Job cuts were made to pay for the rises, leading to bigger workloads. Alternative working patterns were removed from many who still needed them.
It is important to learn the lessons of PACR. Members need to be suspicious when the employer and some union leaders celebrate an offer. The role of PCS is to look critically at what’s on offer and where it doesn’t meet PCS demands, the deficiencies must be made clear. This is what the Broad Left Network is doing as a serious union leadership.
For this 2026 remit, the Treasury is only funding 2%. Anything above this will need to be funded from existing departmental budgets, which will inevitably mean job cuts.
For a department to use the Pay Compression Framework, they need to agree to AAs being on minimum wage. It was never the case that minimum wage was the rate of pay for the job of an AA. We must reject the attempts to devalue the jobs of our members.
Departments must also introduce a “career advancement path” for AAs. That kind of language sounds positive, but it is a mask for the true meaning: the end of the AA grade. This is what’s already being attempted in HMRC, who plan to abolish AAs by 2027. This will put their work onto the remaining staff at AO and beyond. It will also lead to AOs being the next grade that’s a permanent minimum wage job.
As for the money on offer, there’s nothing meaningful for AAs. They will remain on minimum wage, with anything above that being ‘non-consolidated’ (in other words a one-off payment). For Officers, the start of their pay range is already 11% above the AO spot rate. This means they won’t get anything from the Pay Compression Framework.
The only ones who could gain are National AOs. The Pay Compression Framework would see them move from £28,016 to £29,260 – a rise of £1,244. But National AOs in HMRC got a rise in 2025 of £1,246 without any strings attached. Our demand for 10% would give National AOs a pay rise of £2,802. Our AO members must not accept less now.
It’s also important to highlight that the Pay Compression Framework is silent on the position for London weighting. It isn’t clear what would happen for London AAs, AOs and Officers.
We are clear that PCS pay negotiators in HMRC must reject the Pay Compression Framework.
When we campaign, we win
The new PCS NEC, led by a coalition of fighting socialists including members of the Broad Left Network, voted to reject the remit and demand talks for more money. In the event more money isn’t given, our union will need to mount a campaign to build for a whole civil service ballot for industrial action.
The last industrial action like this was the strikes in 2023 against the Tory government. This led to a 4.5% remit and a one off, pro rata payment of £1,500. The PCS leadership at the time made the mistake of accepting this when the member appetite was to keep fighting for more. But even that limited improvement shows what we can achieve when we fight.
It is essential that PCS pay negotiators in HMRC and other departments hold firm to a fighting strategy. They must be clear with their department that no pay talks can take place until our national demands are answered.
Members should take confidence in what we have achieved before and can achieve again. At the same time unions for teachers and for local authorities are preparing to fight in the autumn. This is the beginning of a new public sector fight for pay and we will be a leading part of it.
PCS Broad Left Network 