Where 'local pay' will hit hardest

The Northern Echo: The Government could see a repeat of the strikes over pensions in the pubic sector last year The Government could see a repeat of the strikes over pensions in the pubic sector last year

TEACHERS, paramedics and police officers will be hit hardest by the introduction of local pay in the region, it can be revealed today.

And women in the public sector face more pain than men under the Government’s plans to wipe out higher salaries than those paid by private firms in the North-East and Yorkshire.

The impact of one of the Government’s policies is revealed in evidence from the Treasury to independent pay review bodies.

If true, it will almost certainly see the Government facing the threat of action by teachers already angry over changes to their pensions.

North-East business leaders yesterday joined union bosses to criticise the plan that will mean public-sector workers getting paid less to do the same job as workers in the South.

North-East Chamber of Commerce chief executive James Ramsbotham said he believed that closing the gap that existed between the sectors could provide short-term benefits for businesses that struggle to compete with public-sector wages.

But he added: “The major issue with it is that the Government should be working towards making the economy more equal across the regions and not entrenching further disparity by reducing spending power in the North-East.”

Chancellor George Osborne has vowed to implement local pay from next year, setting lower rates in the North than in London and the South-East, to reflect the cheaper cost of living.

The measure – which threatens some workers with long-term pay freezes – is necessary because higher publicsector salaries are “crowding out” private firms, which struggle to recruit, it is argued.

This week, Mr Osborne accelerated the switch, giving some departments – those where national pay freezes have ended – the go-ahead to backdate any changes to this year.

They include staff working in jobcentres, the Border Force and the DVLA, as well as the departments of business, local government, culture, environment and energy.

However, it will be up to individual ministers whether to opt for local pay – and no worker will have their pay cut, merely held back to allow the private sector to catch up.

Now the Treasury’s evidence has revealed which public-sector staff enjoy the biggest “pay premium” in comparison with average salaries.

It shows the teachers are the most “overpaid”, earning about 1.8 times the average in the North-East and 1.6 times in Yorkshire.

Next most vulnerable to pay freezes are paramedics, police officers and nurses. However, the pay difference is smaller for firefighters and prison officers.

The inclusion of the police in the evidence suggested local pay was still being considered for officers – despite a minister appearing to rule it out last year.

The evidence also points to a study by the Institute for Fiscal Studies, suggesting that public-sector workers were paid 11.7 per cent more in the North-East and 13.4 per cent more in Yorkshire.

But the gap is far larger for women (18.3 per cent in the North-East, 16.1 per cent in Yorkshire) than for men (4.6 per cent and 10.5 per cent).

Labour MPs have vowed to fight local pay, warning of “low pay ghettos” that will widen the North-South divide and take up to £1bn out of the North-East every year.

Last night, the Northern TUC ridiculed the analysis, accusing the Chancellor of a plot to “rob Northern nurses of pay to help fund his tax cuts to millionaires in the South”.

Kevin Rowan, regional secretary, said: “The Government is not comparing like with like. There are no nurses, paramedics or social worker in the private sector, just as there are few engineers or printers in the public sector.

“The only fair comparison to make is between people doing the same job, with the same skills and same experience – not opening up a postcode pay lottery.”

Comments (12)

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11:46am Fri 23 Mar 12

fairness12 says...

A epetition has been set up as part of the fight against this very unfair policy http://epetitions.di
rect.gov.uk/petition
s/31541. It calls for the government to stop pursuing the local pay, and if it won't do this to apply it to MPs before other public sector workers. We need 100,000 signatures to get it debated in the House of Commons - I hope you will give it your support by signing the petition. Many thanks.
A epetition has been set up as part of the fight against this very unfair policy http://epetitions.di rect.gov.uk/petition s/31541. It calls for the government to stop pursuing the local pay, and if it won't do this to apply it to MPs before other public sector workers. We need 100,000 signatures to get it debated in the House of Commons - I hope you will give it your support by signing the petition. Many thanks. fairness12
  • Score: 0

11:58am Fri 23 Mar 12

sefa says...

Sorry, can't. I fully agree with the Government. Pay should reflect the cost of living in a certain area. It happens in the private sector so why not the public.
Sorry, can't. I fully agree with the Government. Pay should reflect the cost of living in a certain area. It happens in the private sector so why not the public. sefa
  • Score: 0

11:59am Fri 23 Mar 12

detachedbystander says...

Interesting to see how this will play out.

Is it right - or fair - that a teacher in this area should get the same - £ for £ - as a teacher in an area where the cost of living is far higher.

A factor of 1.8:1 looks a bit high to me, mind. There needs to be greater scrutiny behind the numbers
Interesting to see how this will play out. Is it right - or fair - that a teacher in this area should get the same - £ for £ - as a teacher in an area where the cost of living is far higher. A factor of 1.8:1 looks a bit high to me, mind. There needs to be greater scrutiny behind the numbers detachedbystander
  • Score: 0

12:16pm Fri 23 Mar 12

stevegg says...

Expect widespread industrial action by public bodies if this is forced through, apart from the police of course who just get railroaded thanks to their ban on industrial action.
Expect widespread industrial action by public bodies if this is forced through, apart from the police of course who just get railroaded thanks to their ban on industrial action. stevegg
  • Score: 0

12:17pm Fri 23 Mar 12

miketually says...

If they're just comparing with the average pay in an area, this makes no sense.

If the comparison is with those with similar skills, experience and qualification working in the a similar role in the same region, I'd not particularly have an issue with it. As a teacher in the North East, I'm "better paid" relative to a teacher in the South East.

Do we really think it'll be implemented properly and at a cost that isn't more than the savings though?

If they do implement it based on the average, however, I think I'll go and work wherever I'll be paid 80% more.
If they're just comparing with the average pay in an area, this makes no sense. If the comparison is with those with similar skills, experience and qualification working in the a similar role in the same region, I'd not particularly have an issue with it. As a teacher in the North East, I'm "better paid" relative to a teacher in the South East. Do we really think it'll be implemented properly and at a cost that isn't more than the savings though? If they do implement it based on the average, however, I think I'll go and work wherever I'll be paid 80% more. miketually
  • Score: 0

12:41pm Fri 23 Mar 12

burnboy72 says...

Is this going to be based on where a worker lives or works. For example, an MP, while they are in their constituency, will they be paid less than when they are in London because of local pay variations. I'll believe it when I see it. Public sector jobs are rarely directly comparable with private sector ones. Also if the private sector is in such a poor state at the moment, how long will it take for their wages to catch up with public sector ones. This is just another example of this government trying to drive a wedge between the private and public sectors. Other than house prices, most other things we need to live should cost the same whether you live in the north or the south anyway.
Is this going to be based on where a worker lives or works. For example, an MP, while they are in their constituency, will they be paid less than when they are in London because of local pay variations. I'll believe it when I see it. Public sector jobs are rarely directly comparable with private sector ones. Also if the private sector is in such a poor state at the moment, how long will it take for their wages to catch up with public sector ones. This is just another example of this government trying to drive a wedge between the private and public sectors. Other than house prices, most other things we need to live should cost the same whether you live in the north or the south anyway. burnboy72
  • Score: 0

1:06pm Fri 23 Mar 12

Graeme_r says...

sefa wrote:
Sorry, can't. I fully agree with the Government. Pay should reflect the cost of living in a certain area. It happens in the private sector so why not the public.
The whole case for this despicable attempt to create yet more division is totally flawed because (1) Govt spending cuts have brought Public Sector recruitment to almost zero, meaning that people will only have the private Sector to choose from and (2)with mass unemployment there are no shortage of candidates for what few private sector jobs are available. Pay should reflect the responsibilities skills and experience needed to do a job. Private Sector pay is not set to reflect the cost of living in a given area. There are many jobs throughout the UK where the minimum wage is paid by employers regardless of average house prices in the area. Unscrupulous private sector employers set pay as low as they can get away with to maximise their profits to the detriment of their employees.
[quote][p][bold]sefa[/bold] wrote: Sorry, can't. I fully agree with the Government. Pay should reflect the cost of living in a certain area. It happens in the private sector so why not the public.[/p][/quote]The whole case for this despicable attempt to create yet more division is totally flawed because (1) Govt spending cuts have brought Public Sector recruitment to almost zero, meaning that people will only have the private Sector to choose from and (2)with mass unemployment there are no shortage of candidates for what few private sector jobs are available. Pay should reflect the responsibilities skills and experience needed to do a job. Private Sector pay is not set to reflect the cost of living in a given area. There are many jobs throughout the UK where the minimum wage is paid by employers regardless of average house prices in the area. Unscrupulous private sector employers set pay as low as they can get away with to maximise their profits to the detriment of their employees. Graeme_r
  • Score: 0

1:36pm Fri 23 Mar 12

Blankface says...

Instead of punishing people up here make the cost of living down there the same problem solved.
Instead of punishing people up here make the cost of living down there the same problem solved. Blankface
  • Score: 0

5:17pm Fri 23 Mar 12

Jolly Roger says...

Well I was a Printer and I had the same qualifications as those down south, but the union bloke said then well the cost of living down south is higher so there are worth more.

So these union Blokes cannot say one thing for the piovate sector workers they represent and another of the public sector.

So play fair treat us all the same, either represent all of us but not one rule for public workers and another for the private ones.

And remember I am a pensioner now and this was over 20 years ago when my wage was not the sme as down south workers.
Well I was a Printer and I had the same qualifications as those down south, but the union bloke said then well the cost of living down south is higher so there are worth more. So these union Blokes cannot say one thing for the piovate sector workers they represent and another of the public sector. So play fair treat us all the same, either represent all of us but not one rule for public workers and another for the private ones. And remember I am a pensioner now and this was over 20 years ago when my wage was not the sme as down south workers. Jolly Roger
  • Score: 0

9:19pm Fri 23 Mar 12

loan_star says...

In my first job I used to get sent on training courses in the midlands and met up with other company employees from down south. When we compared pay, they got a lot more than I did for exactly the same job and for the same company. To be honest I think its time the public sector worked the same way. Welcome to the real world.
In my first job I used to get sent on training courses in the midlands and met up with other company employees from down south. When we compared pay, they got a lot more than I did for exactly the same job and for the same company. To be honest I think its time the public sector worked the same way. Welcome to the real world. loan_star
  • Score: 0

8:38pm Mon 26 Mar 12

Graeme_r says...

To be Honest Loan star I totally disagree and I don't accept what you say universally applies. As I said previously, there is no need to implement this differential, it is based on totally flawed assumptions and it will adversely affect economic growth, a Gideon Osborne own goal. Why should someone in the North be paid less for doing the same job? There are far too many people crowded into the North East and you support daft policies that would encourage even more to want to relocate there. It's not their fault that house prices differ? I worked for a company that paid the same rates nationally apart from Greater London. For staff that transferred "down south" from the North they got paid a mortgage equalisation allowance.
To be Honest Loan star I totally disagree and I don't accept what you say universally applies. As I said previously, there is no need to implement this differential, it is based on totally flawed assumptions and it will adversely affect economic growth, a Gideon Osborne own goal. Why should someone in the North be paid less for doing the same job? There are far too many people crowded into the North East and you support daft policies that would encourage even more to want to relocate there. It's not their fault that house prices differ? I worked for a company that paid the same rates nationally apart from Greater London. For staff that transferred "down south" from the North they got paid a mortgage equalisation allowance. Graeme_r
  • Score: 0

8:39pm Mon 26 Mar 12

Graeme_r says...

To be Honest Loan star I totally disagree and I don't accept what you say universally applies. As I said previously, there is no need to implement this differential, it is based on totally flawed assumptions and it will adversely affect economic growth, a Gideon Osborne own goal. Why should someone in the North be paid less for doing the same job? There are far too many people crowded into the North East and you support daft policies that would encourage even more to want to relocate there. It's not their fault that house prices differ? I worked for a company that paid the same rates nationally apart from Greater London. For staff that transferred "down south" from the North they got paid a mortgage equalisation allowance.
To be Honest Loan star I totally disagree and I don't accept what you say universally applies. As I said previously, there is no need to implement this differential, it is based on totally flawed assumptions and it will adversely affect economic growth, a Gideon Osborne own goal. Why should someone in the North be paid less for doing the same job? There are far too many people crowded into the North East and you support daft policies that would encourage even more to want to relocate there. It's not their fault that house prices differ? I worked for a company that paid the same rates nationally apart from Greater London. For staff that transferred "down south" from the North they got paid a mortgage equalisation allowance. Graeme_r
  • Score: 0

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