Homepage Education Events Research Resources Executive Pay
Show News
  1. Home
  2. News
  3. Government rejects regional pay in public sector

Government rejects regional pay in public sector

PUBLIC SECTOR

Government rejects regional pay in public sector

The government has ruled out introducing regional pay in the NHS, civil service and prison service. George Osborne announced in his Autumn Statement to Parliament on 5 December 2012 that the government would be accepting the recommendations of the independent review bodies not to push ahead with “market-facing pay”.

The Chancellor said: “We are today publishing the reports we commissioned from the pay review bodies on market-facing pay. We commit to implement these reports. This means continuing with national pay arrangements in the NHS and Prison Service, and we will not make changes to the civil service arrangements either.”

In his Budget on 21 March 2012, the chancellor confirmed that he wanted public sector pay to be “more responsive to local pay rates”. He asked the pay review bodies to draw up proposals for localised pay markets.

In the event, the review bodies advised against introducing local pay systems in the NHS, prison service and civil service.

%ADVERT%

NHS review body recommended:

"Our detailed analysis of geographical pay variation against recruitment and retention indicators does not provide the firm evidence which would be essential to justify further investment in additional market-facing pay in the NHS at this time. Our analysis does show that recruitment and retention indicators are relatively less favourable in London and areas surrounding London. If our research points to anything it would point to more investment in pay in parts of London rather than outside. However, any such regional pressures should be seen in the context of relatively high unemployment and may not be strongly linked to pay."

Prison service review body receommended:

"The national, outer and inner London pay ranges in Fair and Sustainable accord with practice among other large employers operating at many sites throughout the country. Fair and Sustainable allows further flexibility to deal with specific local problems, but we believe it should be fully implemented before any changes are made. Then any further local pay additions must be fully justified because such additions are invariably difficult to reverse. If we are required to make recommendations on local pay in the future we shall need detailed data broken down to local levels. NOMS has said it is also taking steps to collect local information on vacancies and recruiting campaigns which we look forward to receiving to enable us to consider fully any proposals for adjustments to staff pay and allowances in the future."

Want to know more?

You can download the review body reports in PDF format from the Office of Manpower Economics web site.