PUBLIC SECTOR
Two-year pay freeze for most public sector workers
A two-year pay freeze for public sector workers earning more than £21,000 a year was announced by chancellor George Osborne today delivering his first Budget.
Some 1.7 million public servants who earn less than £21,000 a year will receive a flat-rate increase of £250 for the next two years. The chancellor said the wage freeze will "save £3.3 billion a year by 2014-15".
“Pay will also be frozen in 2010-11 for civil servants who are yet to agree a legally binding pay deal, except for those earning £21,000 or less, who will receive at least £250 a year. These civil servants will then exit the freeze ahead of other groups.” – Budget 2010 Red Book.
Reactions
Chartered Institute of Personnel and Development
www.cipd.co.uk
Charles Cotton, CIPD reward adviser, said:
“In the short term, while a pay freeze will stop the public deficit getting any worse, it will do little to help the deficit get any better. For that to happen we need to review what public sector services we need, what delivery structures are most appropriate, what skills, behaviours, attitudes and performance we need from public sector workers and how we should reward and recognise these. At the moment, however, serious joined-up thinking about how to reform pay and benefits to get the best from public sector workers is being drowned out by the incessant, monotone noise of the deficit reduction vuvuzelas.
“The government also needs to be wary of the dangers of a prolonged squeeze on public sector pay. Keeping the lid on pay for year after year would cut costs at the expense of severe public sector recruitment and retention difficulties. This would harm the quality of public service provision as public sector employers would have to make do with lower quality staff, while history suggests that periods of tight pay restraint are subsequently followed by periods of significant public sector pay inflation when earnings are raised to competitive rates.”
Unison
www.unison.org.uk
Dave Prentis, Unison general secretary, said:
“Public sector workers will be shocked and angry that they are the innocent victims of job cuts and pay freezes. Freezing public sector pay when inflation is running at 5.1% and VAT is going up, will mean a real cut in living standards for millions of ordinary workers and their families - already struggling to pay rising bills.
“Nurses, social workers, midwives, paramedics, police community support officers, housing and environmental officers who provide vital public services, are amongst those who will be hit hardest by the two-year pay freeze. And for local government workers this comes on top of this year’s freeze.”
Want to know more?
For full details of what was announced in the June 2010 Budget visit www.direct.gov.uk.
--> The 2010 Spending Review will be published on 20 October 2010.