a presentation by: enrico tortolano ([email protected]) commercial sector pcs

A presentation by:

Enrico Tortolano ([email protected]) Commercial Sector PCS

The realignment of power and privilege at the summit of British politics has delighted corporate boardrooms and City bankers.

The richest 1000 persons - over last 3 years – increased their wealth by £155 bn.

Enough for themselves alone to pay off the entire current UK budget deficit.

And still leave them with £30 bn to spare.

To subordinate democracy to corporate rule

Corporate takeover of the political process

Business has used it’s skills, finances and resources to impose corporate interests on public policy

Popular democracy and the interests of the majority have been undermined.

Barclays Bank is paying more than £2 billion in bonuses. Goldman Sachs is paying around £8.068 billion in executive pay and

bonuses. The new boss of the state-funded Lloyds Banking group is to collect an

estimated package of £8.3 million.

Tesco’s 2010 annual accounts show that the average salary of its 372,338 full-time equivalent employees, grossly inflated by the inclusion of executives, was just over £16,500. The average for ordinary workers is considerably less. Many Tesco employees have to apply for tax credits and social security benefits to keep their heads above water. Yet chief executive Terry Leahy picked up £17.9 million in pay, bonuses and share options.

The millions spent on bonuses at the 82% taxpayer-owned bank RBS, would be better spent on keeping vital public services running. Remarkably, the bonuses paid out by nationalised banks exceeded those paid out to every other public sector worker in the country. It's yet more evidence that we are not all in this together.

77% of the budget deficit is being recouped by public expenditure cuts benefit cuts

No tax increases for ultra-rich

Top 1000 have combined wealth of £414bn

Seems New York heiress Leonora Helmsley was right: “only the little people pay taxes”.

Five Local Pay Myths

There are a number of myths and misunderstandings about local pay determination in the private and public sector. In part this is because some of the economic theory behind many of the assertions is bereft of actual examples.

Myth one: ‘While private sector pay is set in accordance with local labour markets, public sector pay is usually set on a national basis.’ Here is an example of not comparing like with like. The fact is that most large, multi-site private sector companies have national pay structures.

Myth two; ‘private sector pay is set in accordance with local labour markets’. In practice, large, multi-site private sector companies operate with up to 4 or 5 bands or zones within a national framework.

Myth three: there is significant regional pay variation outside of London and the South East. In reality there is much less than is imagined. There is much more similarity than difference. In practice, most of the retailers and banks that operate with zonal-type pay systems have national pay structures outside the South East that have worked well for them for some time, without seeking to differentiate between Newport, Newcastle or Nottingham.

Myth four is that pay is determined at a local level in the private sector. Most have efficient national pay structures.

Myth five is that there is something intrinsically more efficient about not having any national structures in place. But leading HR professionals in large companies with branches throughout the country would say national pay structures and national pay determination provide simplicity, avoid the costs of duplication, allow better pay bill control, create fairness.

Unions’ campaigns successful

Government use Policy Exchange to retrieve local pay from long grass

Local Pay, Local Growth: Reforming pay setting in the public sector : Policy Exchange Sept 2012

Rebalancing the pay and pensions of public sector workers so that they are in line with that of equivalent workers in the private sector would save the UK £6.3 billion a year in public spending.

The report – Local Pay, Local Growth – says that the public sector 'premium' – the additional pay a typical public sector worker receives over a private sector worker – now stands at around 7% for the average worker. Combined with increased generosity in pensions the total ‘premium’ is nearly 14% for the average worker in the public sector.

The report, co-written by a former Treasury civil servant, argues that this situation has arisen because of the system of national pay bargaining. It recommends abolishing this system and enabling local public sector employers to choose their systems.

This is fantasy politics based on flawed research and wholly driven by ideology.

Comparing jobs in the public and private sector is difficult. Real experts such as Incomes Data Services, who do not have a right-wing axe to grind, dispute the claim that a public sector pay premium exists.

And it is sheer fantasy to think that pay cuts for public sector staff in poorer parts of the UK would be used to generate private sector jobs in the same region. The Treasury would simply grab the cash – if there was any left once the cost of thousands of local pay negotiations had been absorbed.

Taking money out of the pockets of already hard-pressed public sector workers would hit the private sector hard too, with everyone having even less to spend in local shops and businesses. That alone would take up to 100,000 jobs out of Britain’s regions.

And of course most big national employers in the private sector have national pay rates with an extra London weighting, just like the public sector. Real employers know that the Policy Exchange proposals simply don’t work.”

Myth that civil servants, and public sector workers generally, are paid much more than those in the Private Sector. This is another attempt by the government and their allies in the press to drive a wedge between workers.

Analysts recognise that it is very difficult to compare pay in the public sector with that in the private sector - an attempt to compare apples with oranges - and what pay differences there are, have rational explanations. For example, many of the traditionally lower paid jobs (cleaning, security, messengers etc) have been outsourced from the public to the private sector.

A 2009 analysis by Income Data Services (civil service pay – a

comparative study) reported that: “In particular, basic pay levels for the key civil service grades are behind those for comparable jobs in the rest of the public sector, the private sector and within this, the finance sector”

We believe pay progression should be a contractual right as it is in other parts of the public sector.

The new 1% limit on pay awards includes a large number of pay and related costs and significantly the limit includes “progression increments”,

This says that Departments may include contractual pay progression as part of the 1% limit, but are not obliged to do so. Obviously, negotiators will want to examine the implications of these paragraphs in relation to their bargaining groups, and seek further advice if needed from the NBPP department.

Our advice to negotiators on this is to resist any attempts to pursue buy-outs of existing pay progression (whether contractual or not) as such changes would be invariably damaging and short-sighted.

There is a requirement on all departments to submit 3-Year pay strategies to the Cabinet Office by mid-July. These plans are to include their strategy for moving to Local Market-Facing Pay structures.

Some departments still to respond... and

Of course since departments don’t know what they will be receiving for the 3rd year this is another flawed government process.

Argentina 2001 Financial crisis:

Raised public sector pay Increased national minimum wage Strengthened trade union rights Legislated against private media monopoly Increased taxes on wealthiest

Since the banking crisis: average pay of FTSE 100 directors has risen 55%

corporation tax has been cut the government have not delivered on a

manifesto pledge to clamp down on tax avoidance, instead cutting staff at HMRC

bank profits and bonuses are back in the billions,

there has been no reform of the banks.

© Mass1 Wednesday, April 19, 2023© Mass1 Wednesday, April 19, 2023

Income gone down, regional breakdown: PCS – Unite Study 2012

£


What are you cutting down on

PCS members are cutting down on essentials – food and clothing – to make ends meet.This is true across all UK regions and within all age groups


Have you had to borrow in the last 6 months, regional breakdown

Across the regions, PCS members across Scotland, Midlands and Eastern England have borrowed more often.


YES - Have you had to borrow in the last 6 months Who have you borrowed from?

6 out of every 10 PCS members have borrowed from commercial lenders to make ends meet.This is consistent across ages and UK regions.

Coalition using recession to push through policies that sew it all up for the privileged few

Shutting libraries, swimming pools, restricting access to education and hacking away at the NHS

It’s like kettling the rest of us in every way, closing us in and closing us down

Founded NHS

Invested in Education

Built public housing

Delivered public Transport

And deficit just kept falling until 1970’s….

Regional pay guidance / briefingsPay CalculatorImproving pay websitePay and wealth inequality BookletPay Guidance / remit GuidancePay / economic BriefingsJoint campaigning initiatives - alliances with other Trade Unions Regional TUCLocal activists from N30Journalists / academics

An end to the pay freeze / pay cap policy. No pension contribution increases. Pay progression is a right for all. National Pay Bargaining Not local pay. That equality concerns-should be the central

principle on which pay systems are based and assessed.

It’s not just about fairness. Pay fits into our wider national campaign against austerity.

There is an overwhelming economic case for increasing pay.

Need demand in the economy to create growth and jobs.

Brings in tax revenue and creates more jobs. When government’s cuts back on public

spending during a recession it propels a downward spiral.

a presentation by: enrico tortolano ([email protected]) commercial sector pcs

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