Controversial regional pay scheme opposed by council

The Cube in Corby
The Cube in Corby

Councillors have announced they are to object to Government proposals to introduce regional public sector pay levels.

Earlier this year the Government announced plans to introduce regional public sector pay following concerns that high public sector pay was ‘crowding out’ the private sector.

A motion presented to Corby Councillors at Thursday’s full council meeting raised concerns that the plan could be harmful to the local economy.

There are 3,800 public sector workers in Corby and some members on the Labour-controlled council argue that the scheme could reduce their wages and spending power, and therefore actually harm the private sector.

It is estimated by the left-wing thinktank the New Economics Foundation that the scheme could cost the East Midlands economy £1bn per year and 11,542 jobs.

But Conservative councillors voted against the motion, arguing that the local area stands to benefit from the proposals.

In his motion, council leader Tom Beattie said: “The Government’s case is based on the claim that public sector pay is crowding out the private sector. This is not supported by evidence, particularly at a time of high unemployment.

“There are approximately four JSA claimants for every vacancy in Corby.

“Full time workers in Corby are paid £92 less per week than the British average and 65 per cent of public sector workers are female.

“Regional or local public sector pay... will make it harder for schools and other public services to recruit and retain good quality professionals who could earn more for doing the same job elsewhere.

“This policy will not improve the pay of private sector workers but instead could encourage further depression of wages in all sectors.”

The Conservative Group voted against the Labour motion.

Cllr Rob McKellar said: “The Conservatives believe that the borough stands to benefit from market facing pay as the administrative area for the local public sector institutions is not the borough itself but is in fact the much more prosperous Northamptonshire.

“The local police force, NHC Care Trust and Local Education Authority are all governed at a county level. This means that the introduction of localised pay in the public sector will see Corby, which is a traditionally low paid area, brought into line with the wider county where wages are generally higher. “Labour have based their motion upon a report conducted on behalf of the TUC by the left-wing think-tank ‘The New Economic Foundation’. The NEF admits in its report that its own findings are based upon assumptions and have been “examined in the face of uncertainty”. The motion was passed and consequently councillors will write to the Chancellor of the Exchequer, the Chief Secretary to the Treasury and local MPs. They will also sign up to the Pay Fair campaign.

Following the meeting, the TUC praised the motion. Midlands TUC Regional Secretary Rob Johnston said: “The resolution passed last night shows the true implications for the introduction of regional pay – both in Corby and for the wider region. It is unjustifiable to take money out of the pockets of the 7,100 hard working and dedicated public servants, particularly in a borough where average wages are already £92 a week less than the British average.”

“We welcome the fact that both the Labour and Liberal Democrats voted for the motion and we intend to raise this issue with all the main party candidates in the forthcoming by election seeking their views so the people of Corby know where the candidates stand on this important issue.”