chancellor caps public sector pay rises


By Mark Smulian

Public sector pay rises are to be limited to an average of 1% in 2015/16, the chancellor confirmed today as he set out plans for that year in his Spending Review.

But in a more radical step George Osborne said he would end automatic pay progression, which he denounced as pay ‘simply for time served’.

The Treasury said that despite the restraints on public sector pay since 2010; automatic progressions meant it had still grown on average by more than pay in the private sector.

‘The biggest reform we make on pay is to automatic progression pay,’ Osborne said. ‘Some public sector employees see annual pay rises of 7%.

‘Progression pay can at best be described as antiquated; at worst, it’s deeply unfair to other parts of the public sector who don’t get it and to the private sector who have to pay for it.’

Civil service departments will end automatic progression pay by 2015/16. Automatic progression for teachers will be abolished, uplifts for prison officers will become non-contractual and subject to performance assessments and police progression is already frozen.

Health staff will become subject to local performance standards for pay increases.

Public and Commercial Services union general secretary Mark Serwotka said progression was not automatic in most areas of the civil service and that ending it would cut wage rates.

Osborne added that the number of government employees was expected to fall by a further 144,000 by 2015/16.