Public and Commercial Services Union

Summary of remit guidance

The 2008 pay remit guidance include:

• There is a 2% maximum for ‘base award’ (revalorisation) – see para 6.1.3.
• There is a change to the range between 1.5% and 4.5% of overall paybill increases, with an expectation that awards will average 3.75%% (Increase for Staff in Post) – see para 6.2.3.
• There is a new emphasis on multi-year remits.
• There is a greater emphasis on local pay, with a business case necessary, in some circumstances, to justify not having different rates in different localities. See Para 7.4 in the Guidance.
• Attached as an annex to the guidance are amended Civil Service Reward Principles, which does include ideas on faster progression, including single (Spot) pay rates for lower paid grades.

PCS response

PCS had several meetings with the Treasury and commented extensively on the draft remit guidance, and are very disappointed indeed with the final document, in particular concerning:

The cap of 2% on basic pay rises which again condemns thousands of civil servants to a further year of below inflation increases. We have made it crystal clear that this is an insult, and that PCS will campaign vigorously to challenge this.

The document does not support the efforts which have been made in discussions with the Cabinet Office to address reform of civil service pay, including the establishment of a Task Team which is seeking to identify and consider approaches to, and implications of adopting “job groups” arrangements, across the civil service, for employees in administrative and executive roles at AA, AO and EO levels and equivalents. The Cabinet Office agreed that the terms of reference for this important work would be included within the remit guidance, but this was ignored by the Treasury.

There seems to be no benefit for PCS in multi year pay offers, as the likely scenario would be three years of poor pay rather than one year of poor pay.

The failure to recognise the powerful arguments PCS put about the lack of a “level playing field” for determining pay changes in civil service and related areas, as compared with other major parts of the public sector. We argued strongly, including at meetings with Ministers that separating pay progression costs, from basic pay rises, etc, would produce equality with NHS, Local Government and Teaching areas, whose staff have separately costed pay increments. Thus, these other public sector groups tend to gain better pay rises.

Remit process

All bargaining units must complete the remit financial proforma (Annex 2 of guidance) for each year regardless of who deals with their remit.

Similar to last year there is a list of departments/agencies which are required to submit a full pay remit and supporting business case for Chief Secretary approval (Annex 1) as well as the business case template in Annex 3 of the guidance. Those currently in a multi-year situation are not included. The departments/agencies that must submit remit bids to the Chief Secretary are:

• Department for Culture, Media and Sport
• Department for Communities and Local Government
• Department for Transport
• Department for Children, Schools and Families
• Department for Environment, Food and Rural Affairs
• Department of Health
• Department for Business, Enterprise and Regulatory Reform
• FCO
• Environment Agency
• Government Offices
• Highways Agency
• Land Registry
• HM Prison Service
• HMRC
• Driver and Vehicle Licensing Agency
• Cabinet Office
• Department for Innovation, Universities and Schools
• Ministry of Defence
• Valuation Office Agency

All other bargaining units still need to submit a business case using the template in Annex 3 of the Guidance.

In addition, most bargaining units with less than 500 staff in post (FTE) can have remits cleared by the sponsor department, and bargaining units with staff in post of more than 500 will have remits cleared by Treasury officials or the Chief Secretary. Agencies/NDPB’s will need clearance from Ministers first.

Business cases

Business cases continues to be a universal and key part of the remit arrangements in 2008.

The re-vamped reward principles place the focus on departments and agencies working with the Cabinet Office on their long-term reward strategies and interim measures. In particular if they want to change differentials within a department across agencies. Their assessment will then inform the Treasury. Proposals need to demonstrate how they align with the reward principles and fit within the constraints of the remit parameters.

Pay coherence

Whilst the paragraphs on pay coherence are lacking in objectives and defined strategy, the context of the ongoing national discussions may prove more helpful. Negotiators are encouraged to go through paras 7.1.1 to 7.1.7, and request the information as appropriate to assess whether or not a case can be made for reducing differentials, between bargaining units.

Pay progression

A helpful development is that attached as Annex 4 is an amended version of the reward principles, containing examples of potential pay structures eg, single (spot) pay rates for AA and AO grade, two years for EO grade, three years for HEO grade and four years for Grade 7/6. Negotiators are advised to push management as to what they are doing concerning this, as this should help raise awareness of the joint Cabinet Office and PCS process across the civil service. Nevertheless, in the light of monies available, negotiators are likely to be faced with the same dilemma over basic pay increase versus progression commitments as in recent pay rounds.

Multi year remits

Para 7.6.3 makes clear that these are expected over the period 2008/2009 to 2010/2011, provided appropriate strategies (workforce, reward etc) are in place.

Local and regional pay

The guidance increases the focus on the issue of local pay. It refers to grouping staff together and comparing pay levels as part of an overall package in a ‘relevant local labour market’ see Para. 7.4.1. The next paragraph notes that departments will need to have ‘robust’ reasons not to pay differently across different locations, if they operate in the same labour markets where other public bodies have local pay differences. It is stronger wording than in previous years and is a cause for concern.

Equality issues

The guidance in Para 7.3 (the same wording as last year) reiterates the need for equal pay reviews every 3 years. Para.7.3.3. deals with risk assessment rather than pay reviews in particular about gender and age, with no reference to ethnicity, disability, sexuality or religion. A business case needs to be made in the remit to fund equality problems.

Conclusion

The remit guidance which reflects a business as usual attitude from the Treasury is most disappointing and frustrating. It can only be a catalysis for a further period of industrial relations turbulence, and across PCS (and moreover the public sector) there is the need to continue the campaign amongst members.