Regional Pay

Debate between Aidan Burley and John Pugh

Wednesday 20th June 2012 Commons Chamber

[John Pugh]

That is my next point, because the only good reason for taking forward the approach would be if it was thought that it would improve private sector job opportunities in the poor regions on the basis that public sector jobs appear to be relatively well paid and crowd out private sector employment. If that is happening, one piece of essential evidence—one killer fact—is needed to show that, but it is not differences in the rates of pay in the two sectors, because that reflects a range of things such as job profiles and qualifications. We need evidence to show that as the number of public sector jobs increased in such regions, the number of unfilled vacancies for comparable employment in the private sector grew. That would be the clinching fact, but there is no such evidence. In fact, vacancies in the public sector in the north take longer to fill, because 50% of them are out for eight or more weeks compared with 15% in the private sector. Jobs that pay a living wage and for which skills exist get snapped up. Vacancies do not abound in the private sector except where there are definite skills shortages, and that is because of unemployment. There is no parallel difficulty with failing to fill public sector vacancies in better-off areas.

In the absence of that one piece of clinching evidence, which simply is not there, one could take a barrow-boy view that one could none the less get away with paying people less in the public sector in less advantaged areas, and especially get away with lower pay for the less well-paid, thus banking a cash saving for the state. I understand that argument, but it would be a wholly inappropriate way for a state to behave. It would be inappropriate for the state to discriminate simply by doing what can it get away with. We do not pay women or ethnic minorities less because they might be willing to work for less. If it was easy to get people to take the king’s shilling in the north, would we offer them sixpence instead?

[Mr Burley]

We already pay every public sector worker outside London less because of the long-established principle of the London weighting. Would the hon. Gentleman abolish the London weighting and pay everyone the same as people working in London?

[John Pugh]

The special housing problems connected with London have been recognised for about 30 years. No one is arguing about that—it is not what the Government are arguing for, and it is not what divides the House.

I have been in politics for quite a long time and worked hard in my region. I have met oodles of people, worried and fretted about regional regeneration, met industrialists, attended forums and spoken to experts. However, no one outside London has ever said to me, “Do you know what we want in this area? What we really need is regional pay.”