Academics condemn regional pay proposals

Manchester academics have joined colleagues nationwide in condemning government proposals for regional pay in the public sector.

The open letter to The Times, signed by 60 scholars, warns that the proposals could “aggravate geographical, economic and social inequalities” and points to research by the Trades Union Congress (TUC) suggesting they could cost the economy £10 billion a year.

Under the government’s plans, national pay rates would be abolished and the salaries of public sector workers, including teachers, nurses and police, would be adjusted to reflect the region they live in.

The letter reads: “As senior academics working on regional issues, we can find no convincing evidence within these reports to support the Chancellor’s inference that such regionally or locally-determined pay could boost the economic performance of regional economies.”

Professor Jill Rubery, Deputy Director for Human Resources at Manchester Business School (MBS), who signed the letter, said: “Regional pay would just reinforce the poverty levels in the economy, people have less money to spend and it will just reinforce the recession.”

Speaking about the effect on universities, she said: “Manchester finds it quite hard to attract people to move anyway, but it would be much more difficult if we were on a lower pay scale than, say, the South of England.

She predicted that “Manchester would just ignore the national system and start paying higher wages anyway” but warned that there “might be more differentiation in what people are paid according to their subject area, with much lower pay rates in arts and humanities than in sciences”.

“The end result might be that it costs Manchester a lot more if student fees went on the salaries of the lecturers,” she continued.

Another signatory, Professor Miguel Martinez Lucio, Professor in Human Resource Management at MBS, said that regional pay is “about pushing people down in terms of pay and conditions”.

“In the university system this will mean even greater inequities amongst staff. Students may be getting better service in ‘formal terms’ but the learning experience is changing due to larger numbers, and access issues are likely to be even greater in future.”

The University and College Union supported the academics. A spokesperson said: “People across the country are struggling as their bills rise and their pay does not keep pace. Introducing further real-terms pay cuts is simply not on.

“The government should start listening to the evidence on this, and other, issues.”

A report published by the New Economics Foundation think-tank and funded by the TUC claims that this move could harm the economy.

It finds that under the new system there could be 110,576 fewer jobs nationally and that the economy could lose nearly £10 billion every year.

Brendan Barber, TUC General Secretary said: “We hope that our report will prove to be the final nail in the coffin for these discredited proposals.”

Alan Manning, North West TUC Regional Secretary, said that the plans “will end up costing the North West economy dearly as public sector workers suffer pay cuts and are forced to rein in their spending” and added that they are “not just unfair, but ill-thought out”.

The proposals have already been questioned by several Conservative MPs and the Liberal Democrats, who last month at their party conference voted to try and block them.

A spokesperson for the Treasury said: “As the Chancellor set out in the 2011 Autumn Statement, there is a case for considering how public sector pay could better reflect local labour markets.

“In line with the usual process the Government is considering the independent Pay Review Bodies’ reports and will publish and respond in due course. Nothing has yet been decided.”