Campaigning against government pay policy

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2012 National Delegate Conference
6 February 2012
Carried as Amended

Conference notes that on 29 November 2011 George Osborne announced a further government attack on public service workers by announcing the intention to cap public sector pay rises to just 1% for two years – after the current pay freeze ends. This at a time when the whole economy annual increases for the quarter ending November 2011 averaged 2.5%. The IDS forecast pay settlements in January 2012 will average 3%.

For local government workers this cap could follow three successive years of frozen pay under current government policy, during which time inflation has stood at around 5% per annum. With increased living costs, particularly in soaring energy bills, the net effect has been a reduction in disposable income of over 20% in that time.

As with local government, the government’s submission to the NHS pay particularly calls for a further squeeze on pay for the next 3 years. The near total pay freeze in operation for the last two years has seen the value of health workers pay fall by between 6% and 10%. At the same time a number of NHS Foundation Trusts have imposed cuts to terms and conditions which have further reduced the pay package of NHS staff. The government are pushing the pay review body to embrace a recommendation to in effect, tear up Agenda for Change and impose regional and even local pay bargaining and the introduction of local terms and conditions of service.

These proposals are being proposed against a backdrop of £20bn cuts in finances to NHS and the biggest structural change since 1948.

The results of these attacks means that morale within the service is at record low levels and will have a major impact on the recruitment and retention of skilled workers. This will hit the vital services delivered in NHS and therefore must be of concern to all UNISON members.

In that context Conference is appalled by the comments of the Labour party leader in January suggesting that public service workers should accept further pay freezes and pay cuts. We welcome the robust rebuttal issued by UNISON Labour Link Committee on 30 January 2012 and look forward to our opposition being raised at every level within the Labour party.

The big issue is around 90% of all workers – whether in the public or private sector – are seeing substantial cuts in their real disposable income. Moreover approximately 5.3 million people – over a fifth of all employees in Britain – fall below the low pay threshold, one of the highest rates in Europe. Our economy suffers from significant levels of wage inequality and a culture of households working long hours to meet their basic needs. Conference notes that we have consistently argued that workers should be paid at a rate which provides a ‘living wage’, that is sufficient income to secure an adequate living standard without being dependent upon in-work benefits. Far from being a time to retreat on low pay, we need a living wage campaign now more than ever: no one should have to do a hard day’s work on less than a living wage.

Conference notes there is no guarantee our local government members will even get the miserly 1% pay increases, given the previous refusal of the NJC national employers to ‘award’ the £250 Osborne so graciously tipped to the lowest paid. This, in turn, will doubtless signal further attempts to erode terms and conditions locally. There is a very real prospect that members not just in local government but in the community and voluntary sector could be facing a continuous five year pay freeze.

Conference also notes a parallel aspect of government pay policy with their review into regional pay adjustments. The Chancellor also announced he had asked all public service pay bodies to explore ways in which public sector pay can be made “more responsive to local labour markets” and to report on this by July 2012. This is aimed at completely breaking up national sector pay bargaining with the intention of realising lower wage settlements by making public sector pay ‘more responsive’ to local labour markets.

What that really means is a downward spiral of pay value in both the public and private sectors. It will also have a particular impact on private sector pay in those areas where public sector employment constitutes a considerable proportion of the overall job market, and in those sectors and occupation types where historically public service pay levels have provided at least a de-minimis threshold that uplifted private sector pay. It will also mean in practice that overall pay values could be more depressed in regions with higher levels of unemployment and slower economic growth.

The North West region has already seen, in local government, the devastating way the Comprehensive Spending Review (CSR) impacts differentially on regions. In our two major conurbation cities, Manchester and Liverpool, councils both suffered budget cuts of over 20% in just one year, whilst some areas in wealthier regions had cuts of approximately 3%. It has been estimated that the CSR will remove over £5 billion from the North West economy and lead to 140,000 FTE job losses in the region in both the public and private sector.

That’s equivalent to 5% of the entire regional workforce and represents the most savage level of cuts by proportion suffered by any region. Continued pay restraint, real term earnings reduction and entrenched low pay through regional adjustments will see further detriment in the North West regional and local economies. All our public services will face the threat posed by regional pay in a race to the bottom.

Conference understands that regional pay is part of the same umbrella of austerity measures as pay freezes, pay caps, etc. It is part of the transfer of private sector debt and financial market failure onto the public purse and onto ordinary working people and families in all sectors. And asset stripping the public sector so that essential services are provided under a profit motive rather than for the common good. In attacking public services disproportionately this government is also attacking the scope and availability of local public services which in a deep recession are increasingly needed by our communities.

Conference believes that pay and rewards for public service workers needs to be a high priority for our whole union. Our members understand the reality of cuts and that aspirations and expectations are going to be lower in a time of recession. However, that does not mean we should accept that ongoing reductions in the real value of our earnings year in and year out are inevitable or justified.

Conference instructs the National Executive Council to:

1) prioritise campaigning for better public service pay at all levels of the union;

2) undertake research into the impact on our members of regional pay in public services, including the implications for worsening economic and social inequality in the UK;

3) work with service groups, regions and branches as appropriate in developing research, analysis, case studies and materials;

4) develop a high profile campaign in the short and medium term that engages regions, branches and members against this government pay policy, the ongoing pay freeze, pay caps and any imposition of regional pay in public services;

5) develop a high profile campaign that engages branches, members and the general public in promoting a ‘living wage’ that prevents in-work poverty and is sufficient income to secure an adequate living standard without being dependent upon in-work benefits.