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What's up with public sector pay?

4 September 2008

There's not enough of it, it's unfairly distributed and, worse still for many of us, the situation is getting worse. The government's policy of holding down our pay rises to 2% while prices rise by 4.6% means we face disgraceful cuts in our pay. Resisting these attacks is a crucial challenge for us.

By standing together we can show the importance of having a strong union that is prepared to defend its members’ interests. Those asking us to tighten our belts need to understand there is nothing left to tighten – we are the victims of inflation, not the cause.

This is not just about protecting our standards of living – vital though that is. It is also about standing up for our public services. We know that staff who are demoralised by low wages will find it harder to provide the quality services people deserve.

Our national executive will be deciding this month whether to ballot members on national action over fair and equal pay.

Every member who supports action on pay, every member who takes action, and every member who joins a picket or a demonstration or rally is standing up for themselves, their colleagues and the services they provide. This gives us all something to be proud of.

When you fight, there’s no guarantee of winning. But if you never fight you lose every time.

We know from all we have already achieved together – on pensions and protection from compulsory redundancy, for example – that PCS is a union to be reckoned with. Now is our chance to prove it again over pay.

Our pay rises: what we want

This year we are demanding basic pay rises of 6%. This is to cover inflation, currently 4.6%, and help people catch up on pay losses in previous years.

If our employers offer pay rises that fall short of inflation our negotiators and representatives are encouraging members to reject them.

With the prices of food, fuel and other essentials rising by up to 28% this year, members and their families cannot make ends meet on the government’s ‘2% or less’ limit on basic pay rises.

Our national pay campaign aims to change this unacceptable policy by uniting all our members in the civil and public services. By also working with other unions across the public sector we are seeking to deliver the most powerful message possible to the government.

We have already shown what we can achieve when we are united. Three years ago, for example, we managed to persuade the government to reverse its decision to raise the civil service pension age from 60 to 65.

It is very important all our members get involved in our pay campaign, including any ballots for industrial action our national executive may agree.

We have a number of demands for improving civil service pay which we put to ministers at the Treasury and Cabinet Office in June. These are to:

  • Address the long running unfairness of civil service pay compared to other areas of the public sector where there are separate funding pots for pay progression (moving up pay scales)
  • Ensure the Treasury’s pay remit guidance positively facilitates pay reform, especially to progression systems, and is flexible in helping to implement common conditions of employment such as annual leave and maternity allowances
  • Give some of the money the government has saved from cutting civil service jobs back to staff
  • Make progress on reducing the number of pay bargaining units and annual departmental reviews of delegated pay structures
  • Abandon the pressure on civil service organisations to adopt local or regional pay Inflation proof basic pay awards using the retail price index
  • Stop the practice of linking pay to unfair and divisive performance appraisal systems.

Progressing up pay scales

The Treasury is restricting new pay offers to an average of just 3.75% this year. After they deduct pay progression costs – moving people up the pay scales – there is very little left over to fund basic pay rises.

This often means pay rises do not keep pace with the increased cost of living. Members at the top of pay scales in particular get offers that are generally well below the rate of inflation, with many examples of 0% rises. This is a situation that affects everyone who aspires to the maximum of their pay scale.

PCS wants to change this unfair situation and ensure ‘rates for the job’ are not devalued due to the cost of pay progression.
Our policy is that everybody who is effective in their job should be paid the agreed rate for that job, which is the maximum of the pay scales, and that this rate should be increased each year by at least the rate of inflation. This means every PCS member who is doing their job, but is not yet on the max, is actually being underpaid.

PCS is pressing for the following changes:

  • Faster pay progression – most people should reach their pay scale max after no more than three years.
  • Costs of pay progression to be funded separately from basic pay rises and other pay changes – pay progression should be an ongoing cost as part of settled pay systems that are not normally part of annual pay bargaining, with the costs offset by savings from staff turnover.
  • In this way, pay for members in the civil service and related areas would match those in other parts of the public sector such as teaching, the NHS or local government.

This would all go towards better annual basic pay rises for our members.

Negotiating our pay – the problems we face

Each year, there are over 200 different negotiations on pay in civil service departments, agencies and non-departmental public bodies.

It is a poor and fragmented system that often produces inadequate, widely different rates of pay in different areas. PCS is campaigning for fewer bargaining units and a fairer national pay system with improved and equalised pay rates.

It is becoming clear the Treasury’s controls on pay are now much tighter and the restrictions on public spending even tougher.
Negotiations are often downgraded to arguments about the distribution of an inadequate pay pot. And some reports tell us they have become simply farcical with just one meeting to agree pay rises and management deciding to impose pay offers before PCS members have had a chance to vote on them.

We have pointed out this is totally unacceptable but are asking our negotiators to engage fully in talks to achieve the best possible outcome.

Regional pay is not the answer…

The Treasury is putting increased pressure on civil service departments to consider introducing regional or local pay arrangements.

PCS believes pay by postcode is impractical, unfair and actually runs counter to the need for economic regeneration in many parts of the UK.

We are already experiencing problems with regional pay zones in the Ministry of Justice where they are creating inequalities and tensions.

We are campaigning to end this system and retain national pay rates (with increased rates for London members).
…nor is performance pay and bonuses

Bonus pots worth 1%, 2% or more of the pay bill are becoming more common. These make it even more difficult to achieve reasonable pensionable increases in basic pay, which is the only long term way of compensating for inflation.
Links between pay and performance appraisal have become another vexed issue.

There is no proof these systems achieve anyreal improvements in delivering work more effectively but a lot of support for the view that they actually demotivate, divide and discriminate.

PCS believes these unfair schemes should be scrapped and the money spent more wisely.
We will continue to expose examples of discrimination in how these systems operate and pursue inequality cases at employment tribunals where we can.

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