Unite assistant general secretary for public services,...

Public sector pay

07 January 2014

During 2013, millions of public sector workers across the UK saw their already suppressed incomes ground further down by an austerity-obsessed government.

Ministers are hell-bent on making those that provide vital public services – in the NHS, education and local government – pay for the sins of a greedy financial elite that brought the economy to its knees. George Osborne’s blanket imposition of a one per cent pay rise for the public sector for 2014/2015 smacks of hardline Tory dogma.

It is blatantly unfair and it is the duty of Unite and other trade unions to campaign strongly in 2014 to ensure that public sector workers receive decent pay increases to make up for years of pay drought.

This ‘drought’ has seen our members wrestle with rising debt, the recent hikes in energy and rail prices, and spikes in food bills – households are really struggling to make ends meet.

The scale of income inequality in the UK is brought into sharp relief by the startling fact that around half a million public sector workers are reported to be below the low pay threshold. The majority of this figure are women.

Unite believes that the national minimum wage should be replaced with the ‘living wage’. The obvious place to start is the public sector. It would cost £1.3 billion to put everyone in the public sector on the ‘living wage’, just 0.70 per cent of the total public sector pay bill.

This would have the twin-impact of easing the cost of living crisis for the people who care for our elderly and children, who clean and cook – and it would also have the effect of boosting demand in the economy generally. For every £1 of public money invested in public services through direct employment and procurement of supplies results in a further  64p being generated in the local economy.

The minimum wage of £6.31 per hour for workers aged 21 and over or £5.03 for younger workers creates a sizeable number of working poor necessarily reliant on state benefits, which means low pay employers are subsidised by the Treasury.

Public sector pay restraint alongside an increasing cost of living has seen low paid local government workers lose out in real terms by an estimated £2,831. On average public sector workers are now £2,000 worse off in real terms since the coalition took power in May 2010.

An accredited ‘living wage’ employer is required to ensure the ‘living wage’ is the pay floor throughout their supply chains. State finances would be boosted by £3.2 billion if the UK’s 4.8 million low paid workers were paid the ‘living wage’.

Unite analysis shows that NHS staff have not had a real-term pay increase since 2006, with the exception of eight months when the retail price index (RPI ) was negative. This means that between 2010 and 2014 Agenda for Change staff will have lost between 12.4-15.5 per cent of their purchasing power.

NHS staff are also facing unprecedented attacks on their basic terms and conditions, including on call, sickness, overtime, pensions and the loss of recruitment and retention premia. In some cases, Unite members have lost between 10-30 per cent of take home pay as a result of these imposed changes.

Two-thirds of local government workers in England and Wales - over one million people - earn below £21,000 a year. Just over half a million workers earn below £15,000 a year. The case for these workers to receive a hefty pay increase is unanswerable.

In higher education, our members have taken strike action – with the possibility of more industrial action on the cards in 2014 – in their campaign to improve the current one per cent pay offer. Their pay has seen 13 per cent pay erosion in real terms since 2008.

This is at a time when the average pay of vice chancellors at the elite Russell Group of universities increased by just over £22,000 to nearly £293,000 in 2012-13.

Who said that: ‘We are all in this together’. The time for public sector workers to receive decent pay rises is now.