Low Pay in the Public Sector

Low and falling pay is ruining people’s lives and storing up a range of problems for our future. The New Economics Foundations report Raising the Benchmark: The role of public services in tackling the squeeze on pay (commissioned by UNISON) clearly lays out the extent of low pay in Britain. More importantly the report contains important recommendations to free people in work poverty.

At least one in five workers in the UK economy earn too little to live on (less than £7.47 per hour)
• More than half of individuals living in poverty live in a household where at least one adult works
• One million public service workers are on low pay: And it’s getting worse
• Workers on low and middle incomes are experiences the biggest fall in living standards since records began
• Average workers wages have fallen by £1300 per year under the coalition government
• Those in the public sector are on average £2073 a year worse off
• The report is full of really useful detail on the problems caused by increases in the cost of living alongside wage stagnation.

There is also an excellent section on the myth of the public sector pay premium. NEF also highlight IMF research which indicates that the impact of public spending on the rest of the economy is stronger than previously thought. “This means squeezing public services wages locks us into a more fragile economic future”

Recommendations
• Active support at all levels of government to ensure the living wage is paid by employers across public service supply chains, directly benefiting 1 million public service workers today.
• Government to lift the pay cap, which has resulted in pay in public services falling by more than £2000 a year on average in real terms since 2010.
• Policy action by government to establish robust fair wage resolutions determining benchmarks for employment conditions across public service supply chains.
• Active support by government for collective bargaining of pay and employment standards throughout public service organisations and businesses.
• Action by policy-makers, commissioners and employers to scrap zero-hours contracts in key sectors such as social care.
• Implementation of new indicators, such as mandatory reporting of top, middle and bottom pay by employers across public service supply chains.

The report is an excellent source of information to support campaigns for improved wages in the public sector and importantly, through better public sector procurement rules, across the wider economy.