The Government’s reform of pay will cut almost £7bn a year from the value of public sector employees’ pay by 2015, according to a new report from trade union pcs.
‘Britain needs a pay rise’ reveals that since the start of the recession in 2008, the real value of pay has fallen by 7%. It warns that this, and the fact consumer demand has fallen by 5% in the same time period, is a major obstacle to future economic growth.
The report also shows that those in the civil service earn less than their private sector counterparts. The median pay in the civil service is 4.4% lower than that in the private sector, while those working at executive officer level were paid 10% less than their private sector comparators.
PCS general secretary, Mark Serwotka, said: ‘We believe the Government’s pay policy, built on the lie that hardworking civil servants are paid too much, is having a seriously damaging effect on the whole economy.
‘Instead of burying their heads in the sand and hoping for the best, ministers can and should act now to put money into people’s pockets and back into our economy.’
The report aims to generate a debate about the effects of low pay and government pay policy on the UK economy.