The Fair Pay Review undertaken by Will Hutton published its Interim Report on the 1st December 2010.
Having a fair pay system attracts the best employees, enabling innovation and skill and business development. It retains employees reducing turn over, loss of business critical skills and recruiting costs.
We would suggest that “Fairness” in all aspects of employment contribute to the success of an organisations performance whether that is in the Public or Private Sector and impacts beneficially on our economy.
The Fair Pay Review Interim Report acknowledges this “There is abundant evidence that fair organisations are high performing organisations. Organisations are above all social affairs that depend on everyone pulling together to achieve common ends; front line workers and those in the middle of the organisation need to be motivated and engaged if the organisation is to perform. They will do so much more if they feel they work for a fair employer, and that their managers belong to the same committed ethos. The benefits of fairness extend to the wider economy and society. Britain, like every other advanced modern economy, needs a high performing public sector not just to ensure value for money for taxpayers but because there is a co-dependence between private and public. The public sector is the co-creator of wealth, from public investment in science, education and skills through to sustaining the soft infrastructure that underpins private innovation and investment. It is the custodian of the countries social settlement and preserves law and order. A second or third class public sector can only damage the wider economy and society”.
The premise that the Fair Pay Review should assess how we tackle pay inequalities between top executive pay and the rest of the workforce should be welcomed. However; the Interim Report does not appear to address the key “fair pay” issues facing people working in the public sector.
Those key issues include:
- A two year pay freeze equating to a pay cut
- Almost half (48%) of civil servants are in admin grades where the average (median) pay in 2009 was £17,120 for women and £17,600 for men
- Excluding the very highest earners, the average civil service pension is £4,200 a year.
- More than 100,000 people receive a civil service pension of £2,000 or less a year: over 40,000 receive less than £1,000, and more than 60,000 get between £1,000 and £2,000
- Half a million Public sector jobs to be cut under the Comprehensive Spending Review 2010
- The Civil Service Compensation scheme being ripped apart to cut jobs on the cheap
TUC General Secretary Brendan Barber said: 'At a time when average earnings are failing to keep pace with inflation and many workers are facing pay freezes, FTSE 100 directors saw their total earnings boosted by a massive 45 per cent last year. It is hard to talk about 'fair pay' when there is such a gulf between shop-floor and boardroom rewards.'
We would add “it is impossible to trust a report commissioned by the Con-Dem coalition who are destroying the public sector, the services they provide and economy in which they operate”.
The interim report has not addressed any of the key issues facing fair pay in the public sector.
