News Analysis Government struggles with pay for reform deals

16 Jan 03
As the Fire Brigades Union heads towards a resumption of its strike programme, Prime Minister Tony Blair has maintained his tough stance, saying the stoppages are 'wrong, dangerous and unjustified'.

17 January 2003

But Blair could find that the firefighters' dispute is just the opening battle in a full-scale war between the government and trade unions on public sector pay. Ministers are determined that Chancellor Gordon Brown's millions of pounds for public services must not disappear in wage increases. As they keep telling the firefighters, extra cash has to mean modernisation.

But there is precious little comfort for the government in the progress of negotiations so far.

In health, Alan Milburn is on a collision course with hospital consultants over pay, in a battle that could make or break his attempt to deliver NHS waiting list targets.

Milburn wants the doctors to negotiate locally with hospital managers in England on a range of bonus payments to reward those doing the most work for the NHS. He is considering for the first time offering consultant surgeons and anaesthetists a piece-rate supplement to basic salary, giving a bonus for each extra patient they take off the waiting list.

But the head of the British Medical Association's consultants committee, Paul Miller, has warned that his members already work long hours of unpaid overtime. If ministers are not prepared to negotiate a new national contract to reward this, they could find the consultants less keen to help the government meet its targets.

Meanwhile, GPs expect at least a 15% pay rise in return for adopting a new contract they are negotiating. Figures published at the end of 2002 found one in five GPs plans to quit the health service because of rising disenchantment. Applicants per post have halved since 2000, a drop that BMA GPs' leader John Chisholm has called 'dismal and alarming'.

Blair can't look to the teaching profession for consolation either. The National Union of Teachers is already set to boycott a £1bn deal to fund an extra 50,000 classroom assistants signed this week with the two head teachers' unions.

The role of teaching assistants is a sensitive issue for the profession, which is in negotiations with the government over teachers' contracts and workload. Under the deal on offer, teachers will be guaranteed time out of the classroom for marking and lesson preparation in return for allowing classroom assistants to take lessons. But the NUT has accused the government of blackmail by linking pay and workload. It believes the proposals are all about saving money.

Amanda Gosling, a lecturer in economics at Essex University and a research fellow at the Institute for Fiscal Studies, believes the firefighters' dispute must be treated separately. Elsewhere in the public sector, she says, the issue of recruitment and retention is a major concern and linked to pay. 'Often you can move from public to private and get more money, and so that is an issue for the government.'

With the firefighters, modernisation means an increase in demand for skills and reforming working practices. 'If you compare firefighters' pay to other similar jobs they have done quite well, because they have had their wages pegged to the highest-paid manual earnings. And there are no shortages in the number of applicants for jobs,' Gosling says. 'So it is more an issue about manual and non-manual jobs than the public sector getting the pay levels wrong.'

The government should be concentrating on stress and workload, says Gosling, who believes many of the disputes brewing are about non-wage issues. 'There is a lot more central prescription, which seems to have caused huge amounts of paperwork across the public sector, and there is a perception that people are doing more work but their net pay is not going up.'

At the moment the government is struggling to convince the public sector that its modernisation plans will leave them better off.

More pay for modernisation is a mantra that sounds good in theory. In practice, it is not that simple, as the government is discovering.

PFjan2003

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