Public sector unions prepare to fight pay limits

14 Sep 06
Public sector staff are set to intensify their opposition to the government's reform and pay agendas, in defiance of stern warnings from the prime minister and chancellor this week that they will not halt the pace of change.

15 September 2006

Public sector staff are set to intensify their opposition to the government's reform and pay agendas, in defiance of stern warnings from the prime minister and chancellor this week that they will not halt the pace of change.

Hundreds of thousands of civil servants are likely to vent their opposition to Chancellor Gordon Brown's new 2% pay ceiling in the coming months, amid accusations that the Treasury delayed deals this year to ensure they were covered by the new restrictions.

Union leaders gathered at the Trades Union Congress in Brighton this week warned that they were planning a compendium of strikes and campaign days to undermine the government's privatisation and public service modernisation plans.

The Public and Commercial Services union, which represents civil servants, told Public Finance that around 200 civil service pay bargaining units must use Brown's new 2% remit as the basis for their 2006 agreements – immediately exposing many low-paid staff to below-inflation deals for the foreseeable future. The current CPI and RPI inflation measurements are 2.4% and 3.3% respectively.

A PCS analysis of the 2006 pay round, seen by PF, claims that just 24 bargaining units – which represent either core departmental staff or sub-groups of departments, such as Whitehall agencies – are currently covered by deals that stretch into 2007. Eight further units have, however, received initial pay offers, while pay remits for eight other units have been cleared by the Treasury.

PCS general secretary Mark Serwotka told PF: 'We have around 200 pay deals outstanding and many are being blocked by the chancellor and the Treasury. That will only serve to embed low pay across the sector.'

While the median income for the civil service is £22,150 for men and £17,510 for women, the PCS claims that a quarter of all civil servants earn below £15,340, and over half less than £19,200.

The departments that have yet to conclude their 2006 deals include the Ministry of Defence, Prison Service and Education and Skills. Staff have accused the MoD in particular of dragging its heels over a final offer.

Speaking in Brighton this week, Serwotka said that the pay restrictions in the public sector had been forced upon staff as part of the government's efficiency and modernisation programme, which also includes further plans to privatise services.

Key health, education, transport and criminal justice unions joined the PCS – and a small group of ex-ministers, such as former health secretary Frank Dobson – in calling for renewed action to halt privatisation and government plans to use voluntary organisations to deliver services.

Dave Prentis, leader of Unison, claimed that demoralised staff and patients were falling victim to Labour's 'market madness in the NHS'.

Graham Henderson of the moderate Prospect union accused Tony Blair of 'dogmatic commitment to privatisation contrary to public opinion' and argued that the government had not produced a 'clear evidence-based business case' for most of its reforms.

Speaking to the conference on September 12, Blair admitted that he had 'difficult issues' to resolve with public sector staff. But he warned: 'At the next election, the issue is not going to be whether we put sufficient amounts of money [into services] or supported public sector workers. It will be whether we have delivered sufficient outputs for the money that taxpayers feel that they have put in.

'Let's be absolutely clear: the NHS and our public services have got better – one reason for that is the extra money. But the other reason is the reforms. And if we want to carry on with that investment and not return to the days of under-investment, then we have to keep the reforms going.'

Brown delivered further bad news for unionists who believe he would be more sympathetic to their concerns if he were to succeed Blair. In a private address to the TUC's executive later that evening, Brown said: 'I support everything Tony Blair said today' and endorsed the government's much-criticised health reforms.

However, one senior unionist told PF that it was 'imperative' that public sector staff opposition to privatisation continues at the forthcoming Labour Party conference in Manchester.

Blair and Brown, the source said, have successfully 'controlled the argument for privatisation' to date because they have managed to portray each tranche of reforms – such as last week's announcement on NHS Logistics – as isolated and crucial to improving a single service.

Opponents 'have to place the reforms in the context of how damaging they have been to the wider public sector: job losses, poor services, service closures and short-term profiteering by private companies', the source added.


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