Hey Ho, it’s the striking season again. The NHS is on strike today (13 Oct 14) and is on work to rule for another four days. This strike was only voted for by a small minority of the union membership, but that is a different story. The strike is (allegedly) about a pay deal that hasn’t been honoured, but the public service unions seem to want to call a strike anywhere, anytime they can just to make the public, and government, aware of their presence.
The pay deal in dispute seems to be somewhat complicated. Some Pay Review Board has said that they should get a 1% pay rise, but some of them get an automatic pay rise anyway, and the union says that all should get the 1% rise and the government says that those on the automatic rise should not. At least that is how I read it from the news reports.
It seems that these days there is a Pay Review Board for every different branch of the public sector, and this would seem to be counter-productive. Perhaps it is time for a consolidation into just one Pay Review Board for the whole of the public sector? This should mean that MPs would get the same pay rise as a hospital porter.
We must always remember that the public sector is paid out of what is commonly known as the “public purse”. There are a lot of demands on the public purse, so the first thing to look at is who fills up the public purse, and that is primarily the taxpayer. Public service personnel are also taxpayers, but that is merely recouping some of the top line figure of their wages and salaries. All of the public services take-home pay will have come out of the public purse, so it is really the private sector that fills up the public purse, along with things like VAT and fuel tax that is paid by everyone.
If the private sector prospers, more tax is paid by private sector workers and they spend more money on lifestyle items and therefore pay more consumer taxes as well. If the reverse happens to the private sector then the reverse will happen to the tax takings for the Treasury and there will be less money in the public purse. Isn’t this a good reason to link public sector pay rises to rises in the private sector? In times of austerity, when the private sector is feeling the pinch, it would not be fair for the public sector to get pay rises, paid for by private sector taxes, while the private sector gets none, and even finds their jobs under threat.
The Institute of Fiscal Studies reckons that a public sector employee is better off in terms of wages and pensions than a private sector employee by about 17%. If all public sector employees got a similar wage rise to the private sector, then maybe this anomaly could be addressed, and everybody can either benefit from the nation’s prosperity or suffer the effects of economic downturn equally.
Photo by Roger Blackwell