Magazine article Public Finance

Public Sector Shuns Regional Pay

Magazine article Public Finance

Public Sector Shuns Regional Pay

Article excerpt

Despite the governments insistence that all public sector organisations should introduce regional wage variations, Very little concrete action has been taken, a new report on pay indicates.

Instead, any substantial regional pay initiatives have tended to address the historical imbalance between the cost of living and pay rates in London and the Southeast, the survey by Incomes Data Services suggests.

Since 2001, the Treasury has asked all pay review bodies to investigate whether regional wages could be introduced in their sector, often within the context of a national pay spine.

When the initiative was announced, trade unions feared that the Treasury was attempting to ease the governments wage bill by limiting pay rises in areas with a relatively low cost of living, such as the Northeast.

But Pay in the public services 2005, published by IDS on February 28, shows that there has been little appetite for the initiative. The study states that since the policy emerged three or four years ago, the focus has shifted from potentially paying less in the Northeast to actively paying more in London and the Southeast for a number of key groups.'

Interestingly, separate government initiatives to improve and stabilise pay in key sectors have undermined moves towards regional variations. …

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