Union fury over public sector pay plans

 
George Osborne Mr Osborne is set to outline his Budget plans

Unions have reacted angrily to plans to scrap national pay rates for some public sector workers in the UK.

Chancellor George Osborne is expected to say civil servants, such as Jobcentre and DVLA staff, should have pay brought into line with private sector salaries in their regions.

The Public and Commercial Services union says it would cut regional wages.

The Treasury says public sector pay in some parts of England and Wales is up to 18% higher than the private sector.

Shadow chancellor Ed Balls said he feared the plans would end up in a "free-for-all" and would be difficult to keep public sector pay under control.

Mark Serwotka, general secretary of the Public and Commercial Services (PCS) union - which represents civil servants - told the BBC the plans would be "cruel, economically incompetent and counterproductive" at a time when public sector salaries and pensions were being cut.

The move would mean local factors, such as the cost of living and private sector pay rates, would now be taken into account for public sector workers.

Analysis

The chancellor wants to rebalance the economy and that means getting private sector companies growing. Scrapping national pay deals for public sector workers might level the playing field... or so the theory goes.

In places where public sector workers are paid more than those in the private sector, Treasury sources say private firms are "crowded out" because they cannot compete with the wage levels.

George Osborne is expected to say in his Budget that factors such as the cost of living in an area, and how much local private sector companies pay their staff should be taken into account when setting the pay of civil servants like job centre workers.

But that would mean setting pay levels locally which the trades unions warn would lead to huge disparities across the country and could drive down pay in the regions.

Treasury research suggests the pay gap ranges from 18% in Wales to 0.5% in the south-east of England.

The plans would initially affect 160,000 civil servants working in Jobcentres, the Driver and Vehicle Licensing Agency (DVLA), and border guards at ports and airports.

But local pay rates affecting up to six million public sector workers could be rolled out from next year.

Treasury officials say it would ensure the UK has "a responsive, modern labour force".

Business Secretary Vince Cable would not confirm or deny the plans but said the idea of having more flexibility in the public sector was "surely right".

He told BBC Radio 4's Today programme: "What we're trying to do is make sure that throughout the public sector there's more genuine decision making at a local level and you have to take into account pay and conditions."

He added: "But it has got to be done very carefully because in the civil service, for example, you have to have career progression and that kind of national consideration has to be woven into the story as well."

A Treasury source told the BBC's Chris Mason the move was not about saving money but about ensuring the UK has "a responsive, modern labour force".

'Totally irresponsible'

The source told our correspondent the move is seen as "pro-growth" because it would help make the private sector become more competitive.

In response to the plans, Scottish Finance Secretary John Swinney said: "This would be totally irresponsible and place further pressures on household incomes at a time when we desperately need a boost in consumer confidence to get the economy moving again."

Meanwhile, Wales's First Minister Carwyn Jones said the government should be trying to improve regional disparities in pay, not making them worse.

Public sector 'pays once again'

Shelley from the west Midlands

Shelley, 50, from the west Midlands, has three children and works at a Jobcentre in one of the more depressed areas of Britain.

This is yet another part of the process of making the public sector pay once again for the crime of being those who spend the nation's wealth, albeit on essential services, rather than those who create it.

This government, like previous Tory governments (for such it is, despite the notion of a coalition) consistently views public expenditure as unnecessary spending, not as the provision of public services.

Moreover, they attempt to present the flow of more going to the fortunate and less going to the bereft as somehow fair and just.

This is, in my view, all part of an ideology dedicated to the ascendancy of the private over the public, of capital over civic.

This Tory coalition won't be happy until we have a Britain they can buy and sell to the highest bidder.

"Surely we should be looking at a situation where we look to close the gap in income between different parts of the UK rather than make it worse, which is exactly what this will do."

And Northern Ireland's Finance Minister Sammy Wilson said he would oppose any attempts by Westminster to set local pay variations in the public sector.

The director of the Institute for Fiscal Studies, Paul Johnson, said the government faced a difficult task because public sector pay was frozen until 2014, and only then due to rise by 1%.

"If you want to introduce differential, it's much easier to do it at a time when pay's increasing more quickly so you can, for example, freeze pay in some regions and raise it more quickly in others," he said.

"If it's only going up 1% on average and you're freezing in some regions, you actually can't do very much unless you're waiting a very long time."

The NASUWT, the largest teachers' union, also criticised the suggestion.

General secretary Chris Keates said: "As usual the chancellor holds up the private sector as the comparator. The inconvenient truth he chooses to ignore is that large organisations in the private sector have national pay and conditions frameworks."

TUC general secretary Brendan Barber said: "Moving to regional pay will not just reduce the pay of millions of public servants, but hit regional economies outside London and the South East when people have less to spend."

Len McCluskey, Unite's general secretary, added: "All this will do is drive workers to the better paid regions, leaving large parts of the country without the professionals essential to sustain local services."

And Ravi Subramanian from Unison, Britain's biggest public sector union, said Mr Osborne effectively wanted nurses and care workers in the Midlands to take a pay cut to fund his 50p tax cut for millionaires in southern England.

"It's the politics of division and it shows that the Tories really are the nasty party," he said.

Mr Osborne initially set out the idea in the Autumn Statement.

At the time, he announced a review of national pay rates for public servants and asked the independent pay review bodies to report back in July.

 

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Budget 2012

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  • rate this
    +10

    Comment number 111.

    Obviously an emotive subject seeing the speed at which the comments appear! I too am public sector and see this as yet another attack on just one part of society that provides essential services. You'll notice a huge difference if they're not there. Will my utilities etc reduce in line too? I think not!

  • rate this
    -11

    Comment number 110.

    All the public sector people are the ones moaning about this. This DOES happen in the private sector as well! If you don’t like it find a new job, that’s what we have to do in the private sector. Also if you stop paying money to your fat cat unions then you will have more money

  • rate this
    +8

    Comment number 109.

    So public sector workers should "pay our own way then eh?". We dont actually produce "wealth" but we DO pay tax, OK then, get rid of the nurses, doctors, police, mental health services, social workers who protect abused children and care for the elderly and operate on you, give you medication for your illnesses and protect the most vulnerable people in society for (actually) very average wages!

  • rate this
    +4

    Comment number 108.

    This gov is just hoping that people start to stand up so they can treat them like they are in Syria.With a big smirk on his face.

  • rate this
    +4

    Comment number 107.

    seems like some here know the price of things , not their value. Privatise everything I say. The first ones that will be bawling are those deriding the public sector. They will bawl when they have to pay for private medicine, for their children in nurseries and their parents in care homes. They don't see how they are being subsidise by public sector workers. By then, it may be too late.

  • rate this
    +7

    Comment number 106.

    It just shows the contempt this government has for its country and its people. It`s on the back of the workers of this country that the empire was built. It was (and still is) through their sacrifice that this country remains a free country. It`s about time that those who gain the most from the workers start making a few sacrifices themselves rather that leech of those who have suffered the most.

  • rate this
    0

    Comment number 105.

    THIS POLICY MAKES SENSE! My colleagues in London get paid up to £5000 p.a. and work 2.5 hours less than me per week (equal to 2 weeks per year!) on the basis that living costs there are higher, this makes perfect sense. Bristol has one of the highest living costs outside of London, yet I get paid the same as someone in the same grade working in Hull or Bradford, where things are much cheaper!!!?!

  • rate this
    -2

    Comment number 104.

    fte

  • rate this
    +1

    Comment number 103.

    #47/#14 A bit boring I know, but it was the banks and sub prime mortgage lending that caused the problem. Sad that the New Labour (Tory Lite) party was to some extent taken in, but that's history. Historically,extra spending by Labour was to redress the underspend on many aspects of the UK infrastructure by the Cons. Party. Two years is too long to wait.For starters,local elections soon.

  • rate this
    -3

    Comment number 102.

    I was a civil servant for 5 years before I started to work for a living.
    It's money for old rope. Three people to do a job one could do quite easily. Flexitime, working from home, no pressure and you would have to be an axe murderer before you could be fired for incompetence. The shakeup is long overdue

  • rate this
    -1

    Comment number 101.

    "..Ravi Subramanian from Unison..said Mr Osborne..wanted nurses and care workers in the Midlands to take a pay cut to fund his 50p tax cut for millionaires.."

    More misinformation from a politicised union leader - all indications are that the 50p rate nets precisely nothing. Scrapping it will almost certainly encourage business back here, not that this green eyed unionist would realise it.

  • rate this
    0

    Comment number 100.

    @LALondoner
    "Welcome to the real world..brrrrrr, cold isn't it??"

    What's your job then; shivering captain of industry?

  • rate this
    -3

    Comment number 99.

    Ashamed as I am to admit this, but my wife worked in local government for many years and had the time to knit sweaters & things while being paid. I, on the other hand worked tirelessly driving up and down the UK in the private sector. My pension is worth nout. Her's is pretty amazing.
    I suggest the Unions simply put up and shut up!

  • rate this
    +9

    Comment number 98.

    Why not bring the wages of private sector workers UP to the level of their Public sector counterparts?
    Also, watch George's figures - many low-paid public sector jobs are now private and, conveniently for George, they drag down average pay figures in the private sector.
    Finally, George has far more cash than I, so would he like to take a pay cut to even things up and be 'flexible'?

  • rate this
    +1

    Comment number 97.

    The unions have, quite rightly, defended higher salaries in London because of its more expensive cost of living, so it is pefectly rational for there to be different salary levels elsewhere in different parts of the UK.

  • rate this
    +5

    Comment number 96.

    It makes little sense to regionalise pay if they aren't also going to review the pay for roles. I work in a specialised field which in the local private sector attracts about 30% (minimum) more pay. Will I get that? Fat chance. Those of us who chose the public sector for the job security and sensible pension are suddenly running out of reasons to stay. And that will damage the UK.

  • rate this
    -2

    Comment number 95.

    If implemented properly & fairly,regional pay is surely fair for workers.

    Why should a teacher in the cheap, rural north be rewarded with more disposable income than a teacher in inner-city London?

    That is the logical effect of a national pay scale.Paying London workers more than rural workers won't necessarily mean everyone'll move to London,as the London cost of living is so massively higher.

  • rate this
    +11

    Comment number 94.

    They really have some kind of grudge against public sector workers, don't they?

  • rate this
    +6

    Comment number 93.

    Logically and economically makes sense, but perhaps George Osborne should invert his proposals to try and move people out of the over populated South and London back to the Midlands, North and Scotland. Let's increase salaries and wages where homes are cheaper and get the economy moving in those areas which are more in need. (I am a southerner).

  • rate this
    +16

    Comment number 92.

    To avoid living under a tory government again I'm moving to Scotland and voting for independence. It's the only way to be sure

 

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