HMRC Pay 2026

Formal negotiations begin

Just over a week ago the Exchequer Secretary to the Treasury approved the HMRC Departmental Pay Remit for 2026/27. HMRC require this approval before it can invite the trade unions into formal pay negotiations. Those negotiations have now begun.

As usual, these negotiations are conducted on a without prejudice and confidential basis.

Following the integration of the Valuation Office Agency into HMRC there will be three unions taking part in the pay negotiations, PCS, ARC and Prospect. PCS is the only union which has recognition for every pay grade covered by the Civil Service Pay Remit Guidance.

Civil Service Pay Remit fails to meet PCS pay aspirations

At PCS Revenue & Customs group conference in May motion A6 (below) was agreed, which sets out the union’s pay demands. The Civil Service Pay Remit for 2026/27 provides for a headline increase of 3.5%. There is also provision for departments to make a pay flexibility business case to HM Treasury to apply a differential of 5% between the pay rate at bands AA and AO as well as bands AO and O. Departments must show that they can fund such differentials from within their budgets.

The group executive committee agreed that PCS should join the pay negotiations with HMRC. However it also agreed that as the Civil Service Pay Remit Guidance falls far short of the union’s pay demands there is no possibility of the union recommending to members acceptance of any pay offer based upon it.

PCS will consult members on the outcome of the pay negotiations.

Recruit a colleague to build our negotiating strength in pay talks

As your trade union, PCS continues to negotiate with HMRC to stand-up for your interests. Our strength largely comes through the number of members we have, and every member counts. So if you work alongside colleagues who aren't yet members of PCS then please encourage them to join.

Motion A6 agreed at PCS R&C group conference 2026

Conference recalls Motion A45 carried at Group Delegate Conference 2025. This motion called on the GEC to develop a Group pay bargaining agenda to address the systemic issues in pay. Conference further notes that the Civil Service pay remit for 2025 was published by the Cabinet Office on 22 May 2025 – just two days after the Group Delegate Conference had ended. 

The PCS National Executive Committee met on 29 May 2025 and authorised Groups to enter into delegated pay talks and approximately one month later, HMRC was given authorisation by the Exchequer Secretary to the Treasury to enter into delegated pay talks with Trade Unions. 

At the beginning of the pay talks the GEC placed the following bargaining demands on HMRC: 

• Fully consolidated pay rises of at least 10%.
• A minimum rate of £18 per hour.
• Pay restoration for money lost since 2010.
• A London pay element of at least £5,000 a year.
• A shortening of pay ranges where they exist.
• Automatic pay progression.
• No overlap between pay ranges.
• Reintroduction of a meaningful pay differential between AA and AO spot rates.
• A minimum of 35 days annual leave.
• A significant shortening of the working week with no loss of pay.
• A job security agreement to protect employment, workload and services, including ALB and London-based members, and protections against the threat of AI.
• Cessation of the proposed Mutually Agreed Exit scheme.
• Prioritising pay towards the lowest paid in HMRC, particularly AA, AO and EO grades, using the additional 0.5% to bolster pay in those grades.
• HMRC to prepare a business case for additional funding where recruitment and retention are difficult, such as at HO grade.
• Staggered payments for backdated pay awards to minimise the impact on means-tested benefits and/or student loan repayments. 

Conference endorses these pay bargaining demands. Conference instructs the GEC to develop a bargaining agenda for 2026 that incorporates the Group demands for 2025 that have not yet been achieved and any demands decided by Annual Delegate Conference 2026. Where there is any difference between the two sets of demands, the GEC must use the demand that gives the best outcome for members. 

In the event that the NEC authorises the GEC to enter into delegated pay talks for 2026, Conference instructs the GEC to:

• Place the PCS bargaining demands on HMRC; and
• Issue a briefing to members setting out the demands placed on the employer no later than one calendar week after the demands are submitted.