K&C Council Mulls Voluntary Redundancy Scheme Amid Financial Strain

Kensington and Chelsea Council is considering a voluntary redundancy scheme to address significant financial pressures and achieve anticipated savings of approximately £4.5m via staff voluntary redundancies. The Administration Committee met on Thursday, 11 September 2025, to discuss the Business Efficiency and Voluntary Redundancy Scheme (BEVR) 2025-26, which aims to reduce expenditure by decreasing the size of the workforce.

The council faces financial challenges due to the current national Fair Funding review¹, necessitating cost-cutting measures. The BEVR scheme is designed to mitigate the need for compulsory redundancies and support staff in exploring alternative career opportunities. As of 3 September 2025, the scheme had received 160 applications from interested employees during the application window, which ran from 17 July to 4 September 2025. The report does not state whether this meets the council's target for workforce reduction.

Employees whose applications are approved will exit the council up until March 2026, unless exceptional circumstances apply. The financial impact of the scheme, including redundancy payments, can only be confirmed once all applications have been assessed and approved. Redundancy payments will be met from the council's reserves, which will not directly impact service or General Fund budgets but will reduce the level of available reserves. Pension strain costs incurred before 31 March 2026, will be covered by the Pension Fund and will not affect the General Fund.

The council's Managing Organisational Change Policy was revised to allow the voluntary redundancy scheme to be open to all staff, subject to eligibility criteria that are stated in the scheme's terms and conditions and are in line with the policy. Directorate Panels, chaired by the respective Executive Director, will assess applications from employees up to Assistant Director Level and make recommendations to approve or refuse each application. The Corporate Panel, chaired by Chief Executive Maxine Holdsworth, will review all recommendations and make final decisions. HR and Finance will support all panels, and the Corporate Strategy team will nominate an attendee for each directorate panel. Decision-making Panels will prioritize business needs and retention of essential skills and roles to ensure the council retains appropriate staff.

The report pack for the meeting stated that the scheme aims to achieve savings and mitigate the need for compulsory redundancies in an efficient and compliant manner that safeguards employee morale and retains key workforce.

The Administration Committee was invited to note the details of the BEVR scheme and make recommendations on its full implementation. The Director of Human Resources & Organisational Development will define the operational and governance requirements for the scheme's full implementation and oversee it. It was also proposed that the responsibility to make minor amendments to the scheme to ensure sufficient savings are delivered be delegated to the council's Chief Executive, Maxine Holdsworth.

According to the Public reports pack, the main alternative to the BEVR scheme would be compulsory restructures, which would require significant additional resourcing to support Human Resources and management, with adverse impact on employee engagement. If the BEVR Scheme fails to deliver sufficient staff savings, compulsory redundancies would need to be considered.