12 March 2004
Local government employers are poised to offer around a 2% pay increase this year, half of the unions' claim, under pressure to stick to Treasury inflation targets and keep council spending down.
As Public Finance went to press, employers and the three council unions, Unison, the GMB and the T&G, were due to begin the first round of negotiations. Unison was mustering its members to picket the pay talks with a plan to set off synchronised alarm clocks as a 'wake-up call' to employers.
Both sides have already presented their wish-lists and, with few points of agreement, unions are predicting one of the toughest and most complicated pay rounds for several years.
Sources close to the talks said employers would stick closely to a 2% annual pay increase, wrapped in a three-year package. 'It's fair to assume the offer will have the number two in front of it,' the source said.
The government has placed increasing pressure on all sectors to keep pay awards to its 2% inflation target. According to one negotiator, local government leaders have already been pressured by Deputy Prime Minister John Prescott to offer under 2%, with few concessions on any cost-loaded demands.
Employers rejected the unions' ten-point package as 'unrealistic and unaffordable', within hours of it being put on the table in January. It includes a 4% pay increase, the abolition of the bottom three pay spines and the implementation of Single Status pay and grading reviews within two years.
The unions also want an increase in annual leave entitlement to 25 days and an increase in maternity leave.
The employers claim this would add 5.7% to the £14.7bn pay bill and, under intense government pressure, it is unlikely that they will be given the political flexibility to concede to union demands.
Last year's Local Government Pay Commission, set up after strikes in 2002, is another complicating factor. Peter Allenson, the T&G's new head of local government, warned employers that they needed to be 'constructive, positive and serious'.
He added: 'Council leaders have so far tried to down play the worth and value of their staff by criticising the pay claim. They should not repeat the mistakes of two years ago.'
PFmar2004
