Public sector pay since 2010

Henkeman said:
Government sets the overall budgets. In the case of the NHS, it is then for the trusts to decided whether to implement pay recommendations. So the government has an indirect say, but as with anything, it is the actual employer that decides pay rates. For something like the armed forces, the government has total say. For QUANGOs, which is effectively what many of the public sector employees are part of, they do not.

I know there's this idea that they sit in cabinet and physically decide what a nurse is going to earn, but it's not even practical. Much of the public sector isn't employed by the government - huge swathes of it are employed by councils for a start. It is not a unified thing.
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But for those directly employed by the government of the day, also "public sector" employees, such as Civil Servants, the Armed Forces, etc, the pay increases are determind by government policy. You are no doubt correct in your comments in the second paragraph, although it is slightly facetious in it's tone. The main board of a large company, or group of companies, does not set individual pay rates. They employ staff to do that, but the point is taken. I know, as I have spoken to many main board directors in my career.

I speak fron bitter experience of being a former Civil Servant in the Inland Revenue/HMRC where I served for 35 years before taking early retirement. I was there during Herr Thatcher's rein, where she tore up the 100 year old pay agreement, and imposed on the employees her vision of a "fair pay rise". In 1981, when inlation was around the 19% mark, and following a strike (which the media received "D" notices and were told to minimise the effects of it), the final settlement announced was 7.5% + £30! On the same day, parliament passed, "on the nod", a rise of 18.7% on MP's salaries! Not a pay rise, but a catching up exercise to bring them in line with comparable pay increases across the board. This was, cynically, the basis of the same agreement that she had just torn up for the Civil Service. Most of the other public sector pay agreements were then, in their turn, ripped up.

Sadly, both political parties continued this traditition of limiting public sector pay rises whilst simultaneously cutting services, which is why the situation is as bad as it is. Whilst I agree that MP's are underpaid, in most cases it is not their only source of income. Also,the scale and scope of expenses and benefits paid (unavailable to public sector workers) is a futher source of earnings, as we have seen in many high profile exposés from their claims/convictions.
 
crazyg said:
But for those directly employed by the government of the day, also "public sector" employees, such as Civil Servants, the Armed Forces, etc, the pay increases are determind by government policy. You are no doubt correct in your comments in the second paragraph, although it is slightly facetious in it's tone. The main board of a large company, or group of companies, does not set individual pay rates. They employ staff to do that, but the point is taken. I know, as I have spoken to many main board directors in my career.

I speak fron bitter experience of being a former Civil Servant in the Inland Revenue/HMRC where I served for 35 years before taking early retirement. I was there during Herr Thatcher's rein, where she tore up the 100 year old pay agreement, and imposed on the employees her vision of a "fair pay rise". In 1981, when inlation was around the 19% mark, and following a strike (which the media received "D" notices and were told to minimise the effects of it), the final settlement announced was 7.5% + £30! On the same day, parliament passed, "on the nod", a rise of 18.7% on MP's salaries! Not a pay rise, but a catching up exercise to bring them in line with comparable pay increases across the board. This was, cynically, the basis of same agreement that she had just torn up for the Civil Service. Most of the other public sector pay agreements were then, in their turn, ripped up.

Sadly, both political parties continued this traditition of limiting public sector pay rises whilst simultaneously cutting services, which is why the situation is as bad as it is. Whilst I agree that MP's are underpaid, in most cases it is not their only source of income. Also,the scale and scope of expenses and benefits paid (unavailable to public sector workers) is a futher source of earnings, as we have seen in many high profile exposés from their claims/convictions.
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Even with civil servants it depends. Many of them are through those QUANGOS as well, and there it still isn't down to the government, it's down to their employers. Take for example an agency, oh I don't know, let's say the DVLA. They're civil servants to you, and to me, but not in terms of these settlements. They're paid by the agency responsible who make the decisions based on their budget. The number of people the government directly set pay for is not as large as people think.

And with your example of the Inland Revenue (as was) that's actually a good one. Back then government decided. Now it's HMRC themselves because they are semi-autonomous.

And as for the general point, we can go around the houses on who deserves what, but it remains a fact that public spending as a proportion of GDP is the highest in half a century, and if people want to spend more, then that will go even higher, and someone has to pay for it.

There are differences between public and private, and things like pensions do have to be factored into the overall picture. Private sector workers tend to object to 30% of their council tax going on other people's pensions for example.
 
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Every job deserves a pension and do you know what, you don’t pay for the public sector pension directly...! You pay the mainly low salaries of those who actually pay into the pension... so stop with the whining. Your not funding it all by yourself.

Maybe have a look at the bosses in the private sector who got rid of the final salary pensions in the first place. Many will recall the private sector once had these pensions once upon a time.

Look at the greedy Shareholders who got rid of the this pension because it chipped into their profit margins and dividends.

Next time I go into a retail outlet or any other private sector business I’ll say, I resent paying your full price because a part of it is going towards your pension!
 
bluesoup said:
Look at the greedy Shareholders who got rid of the this pension because it chipped into their profit margins and dividends.
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Well yeah, otherwise they’d have bankrupted most companies if they all have the same generous 40/60ths non-contributory final salary terms.
 
bluesoup said:
do you know what, you don’t pay for the public sector pension directly...! You pay the mainly low salaries of those who actually pay into the pension.
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That’s not true at all.

The public sector pensions are unfunded. That means there is no huge great pension fund that public sector retirees take their pension from.* What is used is money in the public purse from tax payers.**

What you’re describing there is contributory money purchase scheme as seen in most private companies these days.

Nb* this is why public sector workers can no longer transfer their benefits out of the scheme with a lump sum payment, unlike funded defined benefits schemes.

Nb** public sector workers do pay into their pension pot by salary sacrifice but it doesn’t even cover 1/3 of the eventual payout.

Ps - I’m not suggesting it’s a bad thing, just correcting a falsehood.
 
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SWP's back said:
Well yeah, otherwise they’d have bankrupted most companies if they all have the same generous 40/60ths non-contributory final salary terms.
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Non-contributory? It’d be more accurate to call it an unfunded scheme, exactly like the state pension.
Let’s say a band 5 nurse gets paid £27000. Her pension contribution is 9.3% or £209 per month. That gives her a pension of 1/54th of her Salary for one year, which is £500. What’s she’s doing, as you know, is funding current pensioners. The NHS almost always returns a surplus to the treasury by paying out less than it takes in as well.
 
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