Regional Pay (NHS)

Baroness Keeley Excerpts

Wednesday 7th November 2012 Commons Chamber

[Barbara Keeley (Worsley and Eccles South) (Lab)]

Like many right hon. and hon. Members in this and earlier debates—we are lucky to have two debates today—I am against the Government’s move to regional pay in both the NHS and other parts of the public sector. I am a little less clear about the speech of the hon. and learned Member for Torridge and West Devon (Mr Cox), who talked a lot about the pay bill. If we were not spending £1.6 billion on redundancies or £3 billion on an unnecessary NHS reorganisation, the pay bill would not be quite the worry to the NHS that it is—but let us leave that aside.

One of the most important reasons for opposing regional pay is that, as we have heard—I think the hon. and learned Gentleman was saying something similar—regional or local market-facing pay is bad for the economy not only in the south-west but in the north-east, Yorkshire and the north-west. Public sector workers are already suffering. They have had a two-year pay freeze and have suffered greatly from budget cuts and redundancies. The TUC believes that local or regional pay would effectively mean a further freeze, holding back public sector pay for years. That would take even more demand out of our regional economy, with staff having even less income to spend in the local shops and businesses that the hon. and learned Gentleman mentioned. In the north-west, which has 780,000 public sector employees, a 1% reduction in earnings would take almost £190 million out of the regional economy.

A key point is that any reductions would particularly affect women, who account for around two thirds of public sector jobs on average, although the figure is higher in some parts of the north-west. For instance, the neighbouring authority to my local authority of Salford is Bolton, where female employment in the public sector is over 71%, and a number of my constituents work in Bolton hospitals. Proposals that would cut public sector pay would therefore be a further attack on the living standards of women, who we know are already being hit hardest by the recession and the policies of this coalition Government. Figures from Personnel Today show that since May 2010 the number of qualified nursing, midwifery and health-visiting staff has fallen by 6,588, as my right hon. Friend the shadow Secretary of State said earlier. Indeed, between June and July this year, a further 808 posts were lost, which is serious.

That fall in the number of front-line nurses, midwives and health visitors has been clear in my local area for some time, due to the level of efficiency savings being forced on to the NHS to pay for the reorganisation. Figures in The Guardian show that Central Manchester University Hospitals Foundation Trust has announced that up to 1,400 jobs are to go, with Salford Royal Foundation Trust announcing a reduction of 750 posts—including 146 nursing posts so far—Wrightington, Wigan and Leigh Foundation Trust planning a reduction of 533 posts between 2010 and 2014, and Bolton Royal Foundation Trust planning to make a reduction of 248 posts, with two thirds of the first 61 posts removed being nursing and midwifery posts. Even our regional cancer hospital, the Christie, plans a reduction of 213 posts between 2010 and 2015, including, sadly, 43 posts in nursing. That means a total of more than 3,100 jobs going at just five foundation hospital trusts in the Greater Manchester area over three to five years. These are the jobs and careers of my constituents, and we know that women’s jobs are disproportionately affected, because women account for 80% of the jobs covered by “Agenda for Change”. It is in that context—the attack on women and their standard of living—that regional pay in the NHS is a cause for further concern.

The British Medical Association believes that the move from national terms and conditions for NHS staff would have a significant negative impact on the NHS because, as a number of Members have said, the national pay system in the NHS provides benefits for both staff and employers. It has maintained good industrial relations, prevents the duplication of negotiating efforts and has helped to support the recruitment and retention of staff. The Royal College of Nursing believes that any move towards local and regional pay would lead to damaging competition between trusts for staff, because it would entrench low pay in certain areas. There is great concern that places such as Cheshire, which could perhaps offer higher pay, would attract staff from Greater Manchester. That would entrench low pay in areas that are already deprived, such as parts of the north-west, where it would become difficult to attract and retain staff. Regional pay would therefore be unfair and bad for the economies of regions such as the north-west, as well as hitting women harder than men.

The TUC also argues that the case for regional pay is not backed up by evidence, and it makes some important points. As we have heard, comparing public and private sector pay is not comparing like with like. Half the employees in the public sector have a degree, compared with only one in three in the private sector. Importantly, the public sector has a smaller gap between top and bottom pay, and a lower gender pay gap, both of which are welcome. We want to hold on to those. The RCN argues that a move to replicate the pay structures of the private sector would also lead to the replication of inequalities in the private sector, which would be a backwards step. Indeed, I want to challenge the notion put by advocates of regional pay that the public sector somehow crowds out the private sector. In my constituency, there are six people chasing every job vacancy, which is more than the national average. In some parts of the country, such as Hull, as many as 30 people are chasing every job vacancy. It is the lack of growth, jobs and demand in our region that is causing the problem. Budget cuts and redundancies in the public sector, which have already hit our local economy, would be made worse by regional pay.

It is argued that local pay is what the private sector does. However, I worked for many years in the IT industry. I worked in London, the west midlands and Manchester, and we did not have different pay arrangements in those places; in fact, my company would not have been able to persuade people to move from place to place if it did. Of course there is London weighting; that has been with us for a long time. Regional pay would be unfair and bad for the economy of our regions. The arguments are not backed up by evidence. Regional pay is not what the private sector does and it would hit women harder than men. There is no reason a nurse in Salford should be paid less than a nurse in another part of the country. As my hon. Friend the Member for York Central (Hugh Bayley) said, it is important that the NHS should have a work force of the same quality in different parts of the country.

Let me make my last two comments. A nurse in my constituency wrote to tell me that she was against the move from national pay because it would

“pit…employers against each other in bidding wars for staff,”

and would also be completely unfair. A midwife in my constituency told me:

“I have, like all other NHS staff, received no annual pay rise for three years now despite the cost of living rising. The cost of raising four children (one of whom has profound disabilities) on one wage is challenging, as my husband provides 24/7 nursing care. Basic pay for a nurse or paramedic should be the same whether they are saving lives in Preston, Peterborough or Plymouth. Anything else is unfair.”

I support the motion tabled in the name of my right hon. Friend the Member for Leigh (Andy Burnham) on behalf of nurses and midwives such as those.