PUBLIC SECTOR
CBI calls for two-year freeze of public sector pay bill
The CBI today called for an immediate freeze in the public sector pay bill for two years to help get the public finances under control.
Spelling out its priorities for the new government in a “Time for Action: Reforming public services and balancing the budget”, the CBI estimates that freezing the total public sector pay bill from 2010-11 for two years “through selected pay and recruitment freezes” could save £18 billion.
The CBI makes clear that it is not advocating an across-the-board freeze in the pay of every single public sector worker. “Provided the overall pay bill did not increase, there would be scope to exclude frontline staff and the lowest paid from pay and recruitment freezes,” it says.
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A final word
“Over the long term, more steps should be taken to modernise public sector salaries structures. Most workers recognise that job security now depends on what they bring to the workplace, not their seniority or tenure. But the way public sector pay systems are managed has been inflexible and heavily based on a cost escalator. Frustratingly, for good public sector employees, there is little if any differentiation of pay between strong and weak performers. Too many incentives reward stability and length of service, rather than performance improvement and adaptability. This must change.” - Time for Action: Reforming public services and balancing the budget, CBI.
Want to know more?
Title: Time for action: Reforming public services and balancing the budget, CBI, May 2010.
Availability: A copy of the report is available on the CBI web site.
The CBI is the “UK's leading business organisation, speaking for some 240,000 businesses that together employ around a third of the private sector workforce". More details are available at www.cbi.org.uk.