Local Government Pay 2% No Thanks!

I wouldn’t want anyone to think that any of the Councillors at bloggers4labour had leaked supposedly confidential briefing information about local government pay to the trade union side – but if they had it would hardly have mattered as it doesn’t reveal any state secrets.

Local Government workers haven’t been doing that well on pay recently. The third and final payments of the 2004 three-year settlement for local government services' staff took effect from 1 April 2006. The increase to all pay and allowances for 2006/07 was agreed as '...2.95 % or the rate of RPI at October 2005, whichever is the greater...'. The October 2005 RPI figure was 2.5%, so we got 2.95% this year.

In the year to August 2006, the consumer prices index (CPI) rose by 2.5 per cent, up from 2.4 per cent in July. In the year to August, the all items retail prices index (RPI) rose by 3.4 per cent, up from 3.3 per cent in July. Over the same period, the all items RPI excluding mortgage interest payments index (RPIX) rose by 3.3 per cent, up from 3.1 per cent in July. So by two out of three measures of the cost of living price rises are now outstripping our most recent pay increase, meaning that our real incomes (the purchasing power of our wages and salaries) are falling.

The employers will probably start the 2007 negotiations with a 2% pay offer in line with guidance from the Government. They are only looking for a one year pay deal because they want to sort themselves out for a much heavier negotiating round for 2008, therefore they will go beyond 2% in negotiations to try to avoid national strike action over pay.

Well it looks like 4% will be the going rate in the private sector. If we don’t get a decent offer (I hope with a significant flat rate element) then the trade unions have nothing to fear from strike action – our members want to see us fighting over pay and when we do the evidence is that, as in 2002, we grow.

If we don’t put up a strong fight over pay in 2007 we will start on a back foot when the employers try to get an early three year deal from 2008 in line with the Comprehensive Spending Review 2007. I don’t doubt that they will be coming back to some of their old favourites and trying to undermine our conditions of service.

And that’s before they try to increase our pension contributions!