[Closed] Public sector pay freeze

Not a wiser head here Im afraid.

My partner is a lab rat in a hospital. Wages are not good, hours are bad and they just can't retain staff. They get some experience in the lab then move on to other rolls/ bands asap. Mainly as the pay is poor, it's mad busy due to not enough staff and the hours can be pretty bad depending upon what your home life is like.

She just shrugged her shoulders at the news. Simply didn't expect anything different. Oh yeah, and terrible moral there from constantly having managers coming in and tinkering with systems that does nothing to address the fundamental problem. Not enough staff. Ok to of that, constant rumours that the department's are going to be outsourced to private firms in the near future.

Turns out the public seem to be behind the pay freeze though... clapping is cheaper I guess and easily forgotten.

I should disclose that I'm a massive supporter of the NHS, even before it became fashionable this year. It's one of the reasons I'll never, ever vote Tory. Not that it's always been handled will by Labour but the Tories have always fundamentally seen it as a burden rather than the absolute epitome of what a government can achieve when it is truly trying to better the lives of its citizens.

And is restricting the pay of millions of public sector workers potentially going to stifle the post Covid economic recovery?

Yes.
We had one of the worst recoveries after 2008 of the g8 countries because austerity doubled down on the recession.
The country is not a household with a 'maxed out credit card'. Spending more now will stimulate the economy and help it bounce back.

If you work in the private sector you've got a better chance of having a job in a years time if public sector workers have got a bit of spare cash to spend on whatever it is that you sell. But the government will turn us against one another and get low paid private sector workers to agree that low paid public sector workers shouldn't get a pay rise out of pure spite, despite it being against their own interests.

But the government will turn us against one another and get low paid private sector workers to agree that low paid public sector workers shouldn’t get a pay rise out of pure spite, despite it being against their own interests.

Absolutely bloody spot on.

Worked all my career in public service, latterly as a contractor. I’ve worked in half a dozen different departments, arms length bodies etc.
I’m currently seeing lots of relatively young grade 6s and 7s who have progressed through their technical skills without the management skills and experience to effectively lead teams. Since 2010, training budget cuts and effective recruitment freezes has reduced the ability to upskill internally and attract enough talent that already has the skills needed from elsewhere. It’s not about the money, it’s about having the capability to lead and retain good people IME.

Already had a flounce with an acquaintance who states it's a good thing. He's on his second furlough so is earning less than normal, why should public sector get a rise when they can go to work.

If you work in the private sector you’ve got a better chance of having a job in a years time if public sector workers have got a bit of spare cash to spend on whatever it is that you sell

This is the key. Public sector workers aren't a drain on the ecomomy, they ARE the economy.

When it comes down to actually thanking key workers with cold hard cash the government show their real colours. A lot of public sector pay is low and as a result pay rises immediately end up in the wider economy. NHS pay in real terms is >20% lower than 10 years ago and they wonder why there are 120 000 vacancies just when we need them all filled.

Private sector worker, working with public sector here

If you work in the private sector you’ve got a better chance of having a job in a years time if public sector workers have got a bit of spare cash to spend on whatever it is that you sell.

Well not really.   Our place is 2/3 the size it was in November 2019 and they are looking for savings. All my public sector customers are pretty much cut to the bone in terms of staff resources with the conversations I had a year ago about outsourcing to private due to lack of resources now turning to “please make it cheaper, we don’t have the resources to bring it back in house nor the budget to sustain any growth in outsourcing”

tdlr, I suspect most public sector jobs are as safe as they can be but there will be more pressure on private suppliers to reduce cost, which in turn leads them to find cost savings in thier business.

For both public an private sector in general - don’t expect pay rises just be grateful you have a job to go to.

The country is not a household with a ‘maxed out credit card’. Spending more now will stimulate the economy and help it bounce back

Well that of course depends how you spend it. What does my head in about this coountry is the boom/bust black/white mentality. Its either austerity or spend our way out of trouble.

What we really need is the middle road. Prudence.

Just look at what Norway did with its oil revenues. While the UK was busy spending the oil income on tax cuts or whatever else Norway quietly invested it. They limit how much can be taken out each year and now have one of the largest sov weatlh funds in the world. I'm sure the Norweigan system isn't perfect but I wish the UK could find a system where long term thinking was the norm rather than short term policies.

What we really need is the middle road. Prudence.

That would require a complete rebuild of our political system I'm afraid and that's never going to happen!

The announcement of public sector pay freezes is a strange one as it is going to have a massive fallout over the next few months. I fully expect it to be another u-turn in a few weeks.

Missus is public sector (local Gov) and just had a pay increase this year... about 2% after several years of pay freezing under George and Dave.

And her job has been downgraded/scale reduced after a decade.
So yeah, we're rolling in it, I'm considering becoming a stay at home husband...

The "Private sector has bourne the cost" narrative is a disingenuous bit of flim-flam TBH, the private sector has been propped up by furlough, and has also taken the opportunity to shed unprofitable headcount... And something tells me an absolute killing will somehow be made by some in the post-covid "bounce back" that inevitably comes next...

The public sector has bourne the brunt of actually dealing with the pandemic, it's a lovely touch to hoof the whole sector in the teeth for their efforts...

My missus pointed out that despite the rhetoric teachers haven't actually had any time off between accepting key workers kids during LD1 and preparing for a full return in September it's been full time hours with extra stress and worry... And now Rishi essentially tells a whole range of People they're basically scroungers, DM readers will love it.

Tories gonna Tory.

I loved the media reporting about the ‘inflation busting’ pay increases we have apparently been getting. My pay has gone up by a grand total of £1500 in 10 years. Having said that, we can’t expect any sympathy from the public at large and the government know that.

For both public an private sector in general – don’t expect pay rises just be grateful you have a job to go to.

Because the 2nd Ferrari isn't going to buy itself.

https://www.equalitytrust.org.uk/scale-economic-inequality-uk

Alot of private sector pay is low and even those on furlough are taking a 10 or 20% pay cut. I've been on a >10% pay cut all year and job is at risk not to mention only having an actual pay rise a few times in the last 20 years - all my salary growth has happened through promotions. The image of the private sector champaign charlies living it up while the public sector workers scrabble around for spent fag buts on the floor is wrong. Half my family work in the public sector and have very well paid jobs and the pension as well as job security in these tough times. There are highly paid and low paid jobs in both sectors so lets not play one off against the other - that's a zero sum game. Don't think this is the year anyone, private or sector workers, should expect a pay rise. Politicians certainly shouldn't get one.

ust look at what Norway did with its oil revenues. While the UK was busy spending the oil income on tax cuts or whatever else Norway quietly invested it.

Norway's balance of payments is in massive surplus and they have a GDP per capita double that of ours. They only have a population of 5 million so even though they have a generous benefits system it doesn't cost alot compared to ours. Our balance of payments has been in massive deficit since the war apart from a small handful of years. We simply don't have the funds to invest in the same way Norway doesn't. If the UK wants to do anything it has to borrow the money and pay more than we spend on the NHS just in interest payments - how ridiculous is that? without having to borrow money we could double the NHS budget! What a waste. Norway just raids its sovereign wealth fund and has no interest to pay the international money markets. So yes...it does matter if we spend more than we 'earn' as a nation and it is just like balancing your own domestic budget. We can all live off credit all our lives, and some of use do...we survive, but we pay a pretty penny in interest and it limits what we can do and ties up our cash as it's allocated to servicing the debt. In that regards domestic budgets are exactly like nations budgets. You can borrow a couple of billion to build a bridge, but you'll be paying it off for 50 years before you start seeing any return from it and how much of an impact to the nations economy does a bridge actually contribute? It will take hundreds of years for the bridges contribution to get into net benefit.

All this means is that Serco etc will be brought in to replace the failing public sector parts and do an even worse job, whilst creaming off huge profits

I'm in post-16 education, so our funding want protected in the first round of austerity. We've gone from educating 1700 students for £9million a year to education 2000 students for £8million a year.

As our biggest spend is on salaries, that's meant some redundancies and then lots of consolidating roles so as to not replace people when they leave - we're basically 30 staff members down. Class sizes are up and staff moral is down.

We had no pay rises for about eight years and then below inflation for the last two, was well as the downgrading of our pensions.

Sunak is right that this isn't a return to austerity, because austerity didn't end.

it is just like balancing your own domestic budget

It isn't.

I agree it's a handy ruse to continue to divide the country and distract from the bigger issues. MrsMC is local government and firmly in the "we should be grateful we have a job camp", which I find odd from someone who spent the last election night preparing a court report to sort out a mess that could be traced back to austerity cuts.

Another interesting article in the BBC today suggests that the triple lock on pensions could see pensioners get an inflation busting rise in a year or twos time.

I like the phrase "it's cheaper to clap" - I can see that getting used a fair bit in conversations.

We simply don’t have the funds to invest in the same way Norway does

I think the point is that Norway invested it's oil revenue to protect it's long term future, understanding it was a finite resource.

We pissed ours up the wall for short term gain. It may not have been as successful as Norway's has been due to the bigger population, but government's of the time - not all of them Tory - chose not to take the investment option.

Because the 2nd Ferrari isn’t going to buy itself.

https://www.equalitytrust.org.uk/scale-economic-inequality-uk/a >

Do you honesty believe all Private sector people are somehow loaded and paid more than their public sector colleagues?    Not taking away from the impact or amazing frontline efforts of the public sector this year amongst many, but to generalise like that is incorrect.

All the people who clapped key workers but vote Tory should get in the sea, basically.

Do you honesty believe all Private sector people are somehow loaded and paid more than their public sector colleagues?

Do you really think that's what he said or meant?

As Kimbers points out Its just another stage in dismantling the public sector and selling it off cheap (or more likely giving it away for free) to cronies like Matt Hancocks mate down the Dog and Duck.

I have no love for some aspects of the sector but to badly paraphrase FDR on Somosa, yes parts of it are a mess but its our son of a bitch so keep your thieving scummy short term profit long term misery hands off Johnson

Do you honesty believe all Private sector people are somehow loaded and paid more than their public sector colleagues? Not taking away from the impact or amazing frontline efforts of the public sector this year amongst many, but to generalise like that is incorrect.

I don't think anyone seriously thinks that. I posted the link in the OP to highlight that the government are saying public sector pay is now higher, though the stats behind that look a bit suspect to me.

All the people who clapped key workers but vote Tory should get in the sea, basically.

The sea is too good for them frankly. Not just public sector, but all the delivery guys, cleaners etc that kept them going as well as other low paid private sector workers, they all deserve better

.

I work in the public sector. Have had a pay freeze for a number of yrs since the last recession and only just got a few yrs 1% or even 2% this yr which is huge for us.

What also happened after the last recession is that we lost pay progression so lots of people in our place are doing the same job on different salaries and mostly not at the top of the salary range that we advertise and there’s no way of creeping up to the next salary band. This can create quite a divisive environment.

We have massive turnover of staff as we’re in southern England and it’s not cheap to live or easy to get around. If you work for us up country or in most other places wages are much more realistic I guess. Where I live, which is where our main office is, the average house price is £622,000 and there’s a Ferrari dealer who has just won world Ferrari dealer of the yr.

I’ve got a reasonably good job, as has my wife but if you’re starting with us in an admin or technical role you’re earning not much more than £21k and you’re starting at the bottom of the salary range with no way of getting to the top.

We’ve got a visitor centre we run which has just had a massive investment, it’s got it all facilities wise and is very popular. We just can’t keep staff there though. Nobody’s interested if they’ve got any experience as we just can’t offer the salary to get people with experience from the private sector. Things might change I guess but the turnover is a massive issue and causes all sort of problems and stress in the team, something like 50% or more of posts are vacant in that team at times.

I’ve had colleagues get jobs in the private sector with smaller teams and budgets for significantly more salary. Ok, our pensions aren’t as good as they were but they’re still good, but even with this our posts mean a lot of responsibility and large amount of hassle dealing with the job but also stakeholders and locals views on how you’re doing your job.

Like i say, a pay freeze wouldn’t feel so bad if we hadn’t Just had most of 10 yrs of one already and any pay progression taken away.

This is one major problem with the low/no inflation low interest rate situation we find ourselves in.
We need a bit of inflation to grease the wheels of the economy. Maybe it will take off now that government spending on covid related support has exploded?

Alot of private sector pay is low and even those on furlough are taking a 10 or 20% pay cut. I’ve been on a >10% pay cut all year and job is at risk not to mention only having an actual pay rise a few times in the last 20 years – all my salary growth has happened through promotions. The image of the private sector champaign charlies living it up while the public sector workers scrabble around for spent fag buts on the floor is wrong.

Absolutely, but what you're doing is playing into the current administration's hands.
They want to set a 'Them and Us', 'Deserving Vs Undeserving', 'Public Vs Private' sector narrative going, and you're going along with it...

It's classic Tory divide and conquer, they know people are at a low ebb, they know that a fumbled CV19 response and second lockdown has cost Jobs and kept more people on furlough as a result. That's not the fault of teachers/police/nursing staff/housing officers/social workers...

The public sector has been a handy target for misdirection of people's ire for Tory governments for as long as I can remember...

Yes we're in deeper debt as a nation than we would like, it was sadly necessary. But actually the vast majority of the public sector are subject to quite tightly controlled pay structures, and the chancellor ultimately hold the purse strings for those so squashing their pay is pretty easy and obvious.
What he doesn't seem able (or perhaps willing) to control is "emergency spending" via the recently established "chumocratic process". Much less closing tax avoidance/evasion loopholes for big businesses (some of which have done quite nicely out of covid)...

Yes we're hemorrhaging money from the public finances, but stamping on public sector workers is not actually going to address it. Maybe stop paying over the odds for PPE from middlemen who went to school with Gove, send Amazon a proper tax bill, perhaps re-evaluate the need for a high-speed rail connection to London for people who hate London... But seriously what did teaching assistants ever do to you Rishi?

I have not really experienced anything but pay freezes in my career. From teaching to now local government, the most I have had I think is 2% from memory. Obviously nothing like bonuses etc. The only sort of bonus I had in teaching was extra for marking exams for Edexcel. The only consolation of lower pay I have is that I make a real difference in the communities I serve through adult education.

Unfortunately freezing public sector pay is far easier than trying to winkle a fair amount of tax from big digital companies such as google and amazon or trying to ensure a fairer tax system. Plus it divides and more likely to get support, government pushes myths about public sector pay being good already, decent pensions secure jobs (now a thing of the past). If gov tried to get fairer amount of tax from Amazon and google, those companies will say, ah we will have to pass on those higher rates of tax in to higher prices for the consumer. Which one will be more popular?

Do you honesty believe all Private sector people are somehow loaded and paid more than their public sector colleagues?

Try reading the link he posted.

echo all above, no pay progression for time done, so no incentives. Our department was offered a payrise of 12% over 3 years last year! and a close up of all the pre-existing spine points. Sounded to good to be true, the Unions turned it down though, so we got our 2% instead, brilliant...

Well not really... there will be more pressure on private suppliers to reduce cost, which in turn leads them to find cost savings in thier business.

kind of missing the point. By providing some sort of pay increase the government will injecting more money into the economy increasing demand for items supplied by the private sector rather than just giving it to their mates. At least someone will be spending then.

My grade got offered a pay deal last year, it included certain
changes in conditions, once you looked at it it was apparent that my hourly rate actually went down and overtime payments were removed - funny how it got very little take up.

So how are we going to pay for all the support and costs incurred?

I know there is a suggestion of an extra 100 GBP per person next year ( which doesn't seem to be grandstanding) - but taxation is going to have to rise.

The Private sector ( other than banking), is unlikely to be getting pay rises for the next few years, and that is if they retain the jobs.

There is going to be hardship for all going forwards as funding has to come from somewhere - private and public sectors. There is not a magic money tree ...

And I am assuming that the MPs will not get the rise they have proposed.

mrs_oab and I were talking about this - she is teacher.

Frankly we are thankful for secure jobs at the moment, unlike some friends and neighbours.

We are accepting of both tax increase and no pay rises for a while. Such is life, someone has to pay for the overspend debt, cost of corona virus and impending Brexshit.

We are going to be (all things relative) poorer for a few years. Both personally and as a nation.

As a teacher my job is secure, great, my pay is ok, I have modest tastes but a pay freeze ontop of the last long pay freeze is not going to solve the chronic teacher shortages seen in many subjects, granted I dont think pay is the biggest issue in retaining staff, but its not going to help.

The framing of the argument around public sector pay by the Govt is basically just a distraction and a way of appeasing right wing elements in the party.

The way to reduce the public sector debt relative to GDP is to grow the economy. The UK economy has been running a deficit (annual profit and loss) pretty much every year since WW2 so absolute debt (accumulated owed money) has risen year on year - but reduced as a proportion of GDP which is what matters - consistently until the financial crash.

The way to reduce the value and so importance of debt relative to GDP is stimulate growth. In properly managed economies growth not only reduces relative debt burden but increases tax take and reduces reliance on benefits and so reduces the annual deficit.

Pretty much every credible economic thinker now believes the best way to grow economies is to borrow both to maintain economic buoyancy (keeping wages in pockets, increasing public confidence) during hard times but to invest to generate future growth. You really don't do that by freezing pay in the public sector.

So how are we going to pay for all the support and costs incurred?

The only sensible methods are:

1. Grow the economy such that future year's tax revenue deliver surplesses.

2. Inflate our way out of debt

Pay freezes / tax rises are counter productive, they barely dent the deficit and shrink the economy at the same time, thus reducing future years tax revenues.

Austerity #1 was completely counter productive, shrank the economy and slowed our recovery by years.

The government needs to invest in projects with the highest gearing ratio to stimulate growth.

That equality trust article is execrable. I was just about to explode about how utterly stupid the first sentence was, then I read the next bit about what the author thinks is driving the increase in median income....

How can someone so ****in stupid be allowed the put pen to paper.?

The majority of households in the UK have disposable incomes below the mean income (£34,200 as of 2018). This includes wages and cash benefits, and is after direct taxes like income tax and council tax, but not indirect taxes like VAT. The median income has been rising by 2.2% on average for the last five years. Most of this is accounted for by the rise in average income for the richest fifth, which has increased by 4.7%. The poorest fifth, on the other hand, have seen a fall in income by 1.6%[1].

I have not really experienced anything but pay freezes in my career. From teaching to now local government, the most I have had I think is 2% from memory.

Yep. I don't think I've had an above inflation increase in about ten years, usually it's below that or a freeze, which is why many public sector wages are less in real terms than they were before the last crash. I'm fortunate in that I earn a good salary because I'm a senior manager, but it's a real kick in the teeth for all those front line workers we were supposedly grateful for last Spring.

When the private sector's doing well the state sector's told they pay your wages, you can't expect the same. When private sector declines the state sector are told they are to get a pay cut to balance things up. Then people are told government expenditure is a like a domestic budget and people swallow it. This repeats endlessly, every time's the same, and they continue to get away with it.
I don't imagine for one moment all these tiers Johnson has been adding, nudgers, chiefs of staff, purchasers of plastic, are on civil service rates. It's all about shrinking the state and privatising to avoid pension 'burdens' whilst handsomely rewarding chums. Whilst people's pay has been frozen and cut, where do they imagine the fruits of economic growth have gone?

Unemployment is up.
More desperate applicants for every vacancy.
Tory government will always take advantage and lower wage costs.

where do they imagine the fruits of economic growth have gone?

Mainly to the rich, this current low inflation, low interest rate environment has caused asset prices to rise, so if you own lots of assets you've done quite well.....

Exactly, wage stagnation and asset inflation has been the policy for the last 40 years, and it has been overwhelmingly damaging for the majority, with an ever growing severely damaged minority underclass that the Tories use as an excuse.

Tories claim that they are the ones who want to better everyone by growing the economy, but facts just don't back that up, they are all about a small minority being winners no matter what, robbing from the poor so the rich can hoard wealth to such an extent it becomes meaningless other than a way to keep score. They would rather win a 15 second race than place midpack in a 10 second race.

Kryton, this

Well not really. Our place is 2/3 the size it was in November 2019 and they are looking for savings. All my public sector customers are pretty much cut to the bone in terms of staff resources with the conversations I had a year ago about outsourcing to private due to lack of resources now turning to “please make it cheaper, we don’t have the resources to bring it back in house nor the budget to sustain any growth in outsourcing”

Seems to back up exactly what I was saying: the public sector organisations that you with with are "cut to the bone" and they "don't have the budget to sustain growth in outsourcing", and as a result "Our place is 2/3 the size it was in November 2019".

But the government will turn us against one another and get low paid private sector workers to agree that low paid public sector workers shouldn’t get a pay rise out of pure spite, despite it being against their own interests.

This is it really.

It's classic Tories playing to their audience.

Traditional Tory principles are deeply flawed, time and time again they've ballsed things up, but somehow they still manage to claim they're the party to fix the economy. It's shameless bullshit.

Even the Torygraph reckon we'll only 'save' £7bn per year by freezing public sector pay and somehow this is more important that the billions they spunked on buying PPE via dodgy middle men, who just so happened to go to school with them, or be married to their friends. I doubt the figures stack up, people on middle-incomes don't save much, they certainly do stack it up in 'tax efficient' off-shore investments, they spend it. It's £7bn a year taken out of the economy at the worst possible time, to protect the tax cuts for the people who don't spend it, because they don't have to.

So, there we have it, Public Sector pay freeze, another million unemployed over the next 6 months costing the UK £4bn a year in JSA allowance alone.

The Johnson government has made the wrong decision by failing to accept uncomfortable truths at every turn.