Public Sector Pay Policy

Debate between Jim Cunningham and Chris Stephens

Tuesday 5th June 2018 Westminster Hall

[Chris Stephens (Glasgow South West) (SNP)]

I beg to move,

That this House has considered public sector pay policy.

It is a pleasure to serve under your chairmanship, Mr Owen. I refer to my entry in the Register of Members’ Financial Interests and my position as chair of the Public and Commercial Services union parliamentary group.

I shall focus entirely on the pay of civil servants. A few months ago the Government declared—to great fanfare—that the public sector pay cap had been lifted, but is that really the case? On 2 May I asked the Prime Minister:

“Can the Prime Minister confirm that every UK Government Department has budgeted for a derisory 1% pay rise for all its civil servants? Is it fair that workers who collect tax, and who try to make a broken social security system and a broken immigration system work, are getting a real-terms pay cut and are still subjected to a public sector pay cap?”

The Prime Minster responded:

“As the hon. Gentleman knows, we have been very clear that the blanket 1% cap that has taken place over recent years on public sector pay is not an approach that we are taking in the future. Obviously, Departments are funded at a certain level, and it is for Departments then to come forward with their proposals in relation to pay within their Department.”—[Official Report, 2 May 2018; Vol. 640, c. 312.]

In other words, yes. UK Departments have budgeted for only 1%, and it is therefore reasonable to assume that the 1% public sector pay cap still exists and applies to our civil servants. Perhaps the Minister will confirm that the public sector pay cap is in reality still in force.

As the Minister knows, on 19 January 2018 the PCS pay claim was submitted to his colleague the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office. However, the Chancellor of the Exchequer’s spring statement gave no indication that the Government’s position had changed significantly. To date, all further indications have been that the Treasury’s remit guidance, imminent this month, will in effect retain the 1% pay cap for civil servants.

Following the submission of the PCS claim, meetings have taken place with the Minister and Cabinet Office officials, who stated that, in their view, where no pay cap is in place, there is no additional funding for pay, so any increases would need to come from existing departmental budgets.

[Mr Jim Cunningham (Coventry South) (Lab)]

I thank the hon. Gentleman for giving way and for keeping the 1% pay cap issue alive. Not only have public sector workers had to put up with the cap for several years, which in fact has meant a pay cut, but there have been job losses, including in the probation services. The Government are using the oldest argument under the sun: Departments must find the money. But it is the Treasury that should find the money, rather than cutting departmental funding further.

Backbench Business

Debate between Jim Cunningham and Chris Stephens

Thursday 16th March 2017 Westminster Hall

[Chris Stephens (Glasgow South West) (SNP)]

I beg to move,

That this House has considered Jobcentre Plus office closures.

It is a pleasure to serve under your chairmanship, Mr Walker, and I thank the Backbench Business Committee for granting this debate, for which there is cross-party support. With the exception of an urgent question, this is the first time that the House has managed to debate this issue since the announcement of UK-wide office closures. This is an opportunity for hon. Members to represent their constituents and to discuss the effects that the office closures will have on their constituencies. As has been indicated, there is widespread disquiet about the impact that the jobcentre closures will have. I will keep my opening remarks brief to allow hon. Members with closures in their constituencies the opportunity to inform us all of the local impacts on their constituents and communities.

The House is rightly exercised—as are many hon. Members—by the haphazard nature of the closures and the lack of evidence or rationale to support them, other than that they will save money in the short term. The lack of an adequate equality impact assessment is particularly damning. The closures have been presented by the Government as a straightforward process of rationalising the estate—that is, as sensible, considered and thought through in great detail. I would suggest otherwise, however. Far from this being a planned process to make the most of the expiry of contracts to improve services and locate them where they are needed most, it is a cost-cutting, penny-pinching cuts programme being done with poor to non-existent consideration of local conditions.

Instead of consulting appropriately with local partners and seeking to co-locate with other services to improve the effectiveness of Jobcentre Plus services, the Government have embarked upon a Google Maps, back-of-an-envelope exercise, based on achieving a targeted percentage of closures—10% overall, but 50% in Glasgow, as I am sure we will hear. Instead of enabling jobseekers to easily access other services—such as support with housing, childcare, debt management and health conditions—to help them to overcome their barriers to work, the Government have started with the basic premise of how many offices they can close and then worked backwards.

[Mr Jim Cunningham (Coventry South) (Lab)]

I congratulate the hon. Gentleman on securing the debate. For the record, we should remember that at least 30,000 people have lost their jobs in the civil service, and this is part of that. He spoke about the increasing workload. Citizens advice bureaus have reported that their workloads have gone up by 88%, in particular because of personal independence payment claims. Tile Hill jobcentre in my constituency is being closed, so people will have to walk miles or get buses. Importantly, a lot of them suffer from disabilities, so they will be at a disadvantage.

Equality and Human Rights Commission

Debate between Jim Cunningham and Chris Stephens

Wednesday 1st March 2017 Commons Chamber

[Chris Stephens]

The hon. Lady serves with me on the European Scrutiny Committee, and she is quite correct in her analysis.

Continuous service has been broken, so if the employee were to secure a job in the civil service, the break would have a directly negative impact on their pension and any future severance pay. I note that two directors were also served notice, but pay in lieu of notice was not imposed and they remain on the payroll. To date, the commission has not offered any of those at risk of compulsory redundancy alternative employment, which is a statutory requirement. I hope that the Minister will confirm today whether he will intervene on this matter and ensure that all those employees, now numbering 12, will be reinstated.

[Mr Jim Cunningham (Coventry South) (Lab)]

The organisation was set up in the first place through pressure from the trade union and labour movement on human rights and workers’ rights. We have seen two good examples of where the Government are going with Brexit. We have had the Trade Union Bill, which had to be modified through pressure from the Opposition. What do we now expect when the Government come back with their Brexit package and we pull out of Europe? What is going to happen to workers’ rights then, bearing in mind that the Government have done away with legal aid in certain instances?

[Chris Stephens]

The hon. Gentleman is correct that concessions were given to the Opposition, but I think the Government are backtracking on them, as we saw in a Delegated Legislation Committee, with trade unions now being forced to have additional conferences to meet requirements in the new legislation.

Contribution of Poles to UK Society

Debate between Jim Cunningham and Chris Stephens

Tuesday 19th July 2016 Westminster Hall

[Mr Jim Cunningham (Coventry South) (Lab)]

rose—

[Chris Stephens]

rose—

[Daniel Kawczynski]

I will give way in a minute; I just want to finish this point. I could take people now to Polish towns and cities that have been completely depopulated and where there are real risks, dangers and difficulties in being able to provide certain services as a result of the brain drain of young Poles away from Poland; and I could take people to communities in Britain where so many EU nationals have come that there is a real strain on local schools, public services and housing stock. I make this point because I think it is very important. If we are to convince the nationals of both Poland and the United Kingdom that their rights will be enshrined going forward, we need to demonstrate that we can get a grip on immigration in the interests of both countries.

Employee Pay (DWP)

Debate between Jim Cunningham and Chris Stephens

Wednesday 18th November 2015 Commons Chamber

[Chris Stephens]

I do not know the reasons for that, but I think that it should have been possible. As my right hon. Friend will know, in Scotland those earning less than £21,000 a year have received a £250 pay rise over the last couple of years.

Between 2012 and 2015, all DWP staff received a 1% increase, and the Chancellor has announced his intention to limit civil service pay increases to 1% for the next four years.

[Mr Jim Cunningham (Coventry South) (Lab)]

I am sure the hon. Gentleman agrees that, if inflation is taken into account, that 1% increase effectively amounts to a 6% or 7% wage cut, and women in particular are bearing the burden.

[Chris Stephens]

The hon. Gentleman is correct, and I will come on to the fact that it is estimated that what has taken place in the DWP is effectively a cut of £2,245.

There is also the issue of no pay progression within the Department. Since 2009 there has been no mechanism for DWP staff to move from the bottom towards the top of the pay range for their grade. This has meant staff have become frozen at the bottom of the pay range with no means of ever progressing further. Around 70% of DWP staff are in this position.

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[Chris Stephens]

I agree with that, because if there is a pay range and scale, there should be natural progression through experience and training.

With pay increases limited to 1% year on year, simply not enough money is available to create meaningful pay progression and give all staff some annual pay increase. The Treasury has consistently prescribed that any pay progression must be funded from the 1% increase and no additional funds have been made available. My first question to the Department is this: will the DWP change its attitude towards pay progression and allow employees to move up the pay grades and scales?

Let me turn to the increase in pensions and national insurance contributions. DWP staff are members of one of the civil service pension schemes and since 2010 members’ contributions to the pension schemes have been steadily increasing, averaging 3.2% by 2015. These increases have, effectively, eroded the value of the recent 1% pay rise. This has meant that DWP staff take-home pay now has hardly increased at all since 2012. DWP staff also expect to see an increase of around 1.4% in their national insurance contributions in 2016, when the new state pension comes into effect.

Some 40% of DWP staff are on tax credits. The DWP has told the PCS that 40% of DWP staff have to rely on tax credits to supplement their low rates of pay. This is clear evidence of how low pay rates are in the DWP. If the measures to reduce tax credits that were announced in the July Budget were ever to be implemented, there would be a significant impact on DWP staff.

The Government have made many public statements saying that employers should pay a living wage and not make their employees rely on tax credits to supplement low pay. It is ironic, therefore, that so many DWP employees are made to rely on tax credits because the Government will not pay their own staff a decent salary. Furthermore, the Government have justified tax credit cuts by declaring that when their employees lose their tax credits, employers will naturally pay higher wages. However, if the Government rely on tax credits to subsidise the low pay of their own workforce and they are unwilling to compensate these workers who stand to lose from changes to tax credits and the 1% pay cap, it is hard to see how other employers can be expected to practise anything different.

DWP pay is an equality issue. Some 69% of staff are female, predominantly employed in the lower grades.

[Mr Jim Cunningham]

There is a contradiction. On the one hand, Government policy is equal pay for women, but on the other hand they reduce women’s wages at the DWP and other Departments.

[Chris Stephens]

I entirely agree, and I am sure the hon. Gentleman will agree with me that we are seeing an increase in the pay gap between male and female workers.

Low pay in the DWP therefore has a detrimental effect on women. As the highest paid grades in the DWP have a majority of male staff, this has created a significant gender pay gap in the DWP. My next question is this, therefore: what equality impact assessment has been carried out to ensure the DWP complies with the Equal Pay Act 1970 and is not at risk of equal pay claims?

There have been increased workloads and efficiency, but no reward. Time and again, Ministers and those running the Department thank DWP staff for their hard work in keeping the Department afloat and delivering welfare reform. Recognition is always welcome, but DWP staff feel that the thanks need to be translated from mere words into a form of recognition visible in their pay packets.

Furthermore, the DWP workforce has been cut by 30% since 2010, so the pressure on those remaining has increased. In March 2015, the Secretary of State told DWP staff that productivity had increased significantly. He cited record levels of employment, faster processing, fewer calls chasing progress, and an annual operating cost £2.5 billion lower than in 2009-10, yet none of those improvements in productivity has been reflected in increases in DWP pay.

The DWP is one of the lowest paid Departments in the civil service. Prior to civil service pay being delegated to individual Departments, all civil service grades were paid the same, irrespective of which Department they worked in. However, as a consequence of pay delegation, pay levels now vary greatly from one Department to another, and DWP pay is particularly low. There are now well over 100 pay bargaining units across the civil service, and the DWP, as the largest Department, does not do well compared with other civil service Departments.

This will be brought into sharp focus with the roll-out of universal credit, when 2,000 HMRC colleagues, earning considerably more than DWP staff, will transfer into the DWP and will be earning a lot more for doing the same work. For example, 40% of staff in the administrative officer grade in the DWP earn less than the HMRC administrative officer grade minimum. Anyone who joins HMRC on its administrative officer minimum will come in more than halfway up the DWP administrative officer pay scale at £18,415.

People who work in the private sector are better off. This Government seek to justify public sector pay restraint by spreading the myth that life in the public sector is altogether cosier than in the private sector, but the truth is that pay for those in the DWP is now so low that some people in the private sector employed on civil service contracts are leaving them behind. For example, in Steria, the company that won the contract for HR shared services, where some DWP workers saw their work privatised, members have just been awarded a 2.3% pay increase. In Maximus, another DWP contractor, members have recently accepted an offer that will give the majority of them increases of over 15%, with the lowest paid receiving an increase of nearly £5,000.

Increases for private sector workers on DWP contracts are therefore considerably in excess of the 1% awarded to DWP staff. Of course, those pay increases in private sector contracts are funded by the taxpayer every bit as much as DWP pay is funded by the taxpayer. We commend the pay increases for those staff, but we fail to see the logic of the 1% pay cap being so rigidly imposed on public sector workers when that is not the case for private sector workers delivering Government contracts.

We fear that there is discriminatory performance-related pay in the DWP. The Department also pays some staff a non-consolidated payment each year. This is worth 1.9% of the annual pay bill—around £44 million. The payments are distributed based on performance appraisal markings and grade. Staff who have received a “must improve” box marking—around 8% of DWP staff—receive no non-consolidated payment. Other non-consolidated payments vary from £450 for an administrative assistant to £1,750 for a grade 6 employee. These non-consolidated payments have been shown to be discriminatory in many ways. You are more likely to receive the higher award if you are full time, white and under 60, and more likely to receive no non-consolidated payment if you are over 60, BME or part time.

Terms and conditions are also diminishing. At the same time as pay increases in the DWP have been subject to central Government pay restraint and caps, DWP staff have seen a gradual erosion of other terms and conditions. This has taken the form of increased pension contributions and changes to pension entitlements, repeated attacks on the civil service compensation scheme, restricted access to flexitime, a draconian approach to attendance management, and cuts in staffing.

The sense of anger among DWP staff is high. When the 1% pay award was imposed on DWP staff in July, more than 5,700 protest letters were sent to the Secretary of State and the permanent secretary. The PCS receives constant feedback from its members on the impact of pay restraint. My next question therefore is: what assessment has been carried out to ensure that DWP staff reach the so-called living wage target? Or will steps be taken to ensure that this is delivered earlier? Some DWP staff reported regularly borrowing from credit cards to make up the shortfall in their wages and being unable to afford to tax their cars.

My last question is: do Ministers believe that the enormous improvements in productivity that DWP staff have achieved on their watch should be rewarded with an additional pay increase above the 1% cap?

Trade Union Bill

Debate between Jim Cunningham and Chris Stephens

Tuesday 10th November 2015 Commons Chamber

[Chris Stephens]

I rise to speak to amendments 15 to 22, 14, 34 and 31 to 33 in my name and those of my hon. Friends, as well as to new clause 10, with which I will begin my remarks.

Before I do so, I want to pay tribute to the hon. Member for Cardiff South and Penarth (Stephen Doughty), who led for the Labour party in the Public Bill Committee with great diligence. I welcome the hon. Member for Cardiff West (Kevin Brennan) to his place. I also pay tribute to the Conservative members of the Committee, who tried to defend the indefensible. I pay tribute to Labour members of the Committee, the hon. Members for Newport East (Jessica Morden), for Cardiff Central (Jo Stevens), for Gateshead (Ian Mearns), for Middlesbrough South and East Cleveland (Tom Blenkinsop) and for Sunderland Central (Julie Elliott). However, the star of the show—she made the soundbite of the Public Bill Committee—was my hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron): she commented that the Minister had presented the Bill with great moderation but was entirely disingenuous.

New clause 10 is a catch-all amendment that limits the extent and provisions of the Bill from applying to the public sector across the UK without the consent of the Scottish Parliament, the Welsh Assembly, the Northern Ireland Assembly, the Mayor of London and other public bodies and local authorities in England. We took the view that, to protect our approach of working in partnership with unions, Scotland should be excluded from the entire Bill. However, having heard representations from other political parties, and indeed many from across the trade union and labour movement, we now want to restrict the extent of the Bill from applying without the consent of each devolved institution or authority which will be impacted by the changes.

[Mr Jim Cunningham (Coventry South) (Lab)]

I think it is arrogant of the Government to impose the changes on local authorities. We have had three negotiations on the check-off system.

[Chris Stephens]

Like many others in this place, the hon. Gentleman is a former council or local authority leader. He will know that he would have negotiated with the trade unions on issues such as facility time to make sure agreements were made in time and grievances were heard in time to avoid such issues going to a tribunal. I agree with him that it is arrogant and out of order for the UK Government to make decisions—for example, in respect of facility time and check-off—that are opposed by many local authorities across the UK.

The proposals in the Bill have the potential to undermine the effective engagement of trade unions across Scottish workplaces, and indeed across the UK, particularly in the public sector. The Scottish Government response to the “Working Together Review” and the fair work convention have shown a commitment to building a stronger, more collaborative approach to the relationship between trade unions, employees and employers. The combination of the provisions in the Bill will affect employees’ right to strike, will change the relationship between unions and organisations negatively and will lead to greater confusion among employees. That will undoubtedly hit Scottish business, especially across the public services in Scotland and elsewhere in the UK.

As with many Bills in this House, the devil is reserved in the detail, and with a lot of the detail to be set out in regulations, we are unaware of what else may be coming down the line. Moreover, there will be no formal opportunity for the Scottish Government, or indeed any other authority, to influence such regulations, even though they will have a direct impact on them.

According to the evidence of witnesses, there is concern that the Bill could lead to a constitutional crisis if the devolved Administrations refuse to implement the content of the Bill. The Bill potentially cuts across devolved areas and could lead to confusion and a conflict of interests in its application to existing and new contracts, owing to the ongoing local government reforms in other areas. During the evidence sessions, Dave Prentis, the general secretary of Unison, commented that the new combined authorities in England will have a lot of extensions of powers, except the power to determine check-off and facility time arrangements.

The First Minister of Scotland, Nicola Sturgeon, stated in the “Programme for Government 2015/16”:

“my government will vigorously oppose the UK government’s proposed trade union legislation, which seeks to undermine the rights of unions to fairly and reasonably represent their members.”

Carwyn Jones, the Welsh First Minister, echoed those concerns when he wrote to the Prime Minister expressing concerns about the Bill in September 2015, stating that it should be a matter for the National Assembly for Wales.

The Scottish Government maintain positive and stable industrial relations in Scotland. Those relations are underpinned by the long-standing strategic partnership between the Scottish Government and the Scottish Trades Union Congress, which was recently reaffirmed in the memorandum of understanding signed in May 2015. The memorandum pledged the Scottish Government to work with the STUC in opposing Tory austerity and in demanding further powers for Scotland. The Scottish Government view trade unions as key social partners, playing an important role in sustaining effective democracy in society, particularly in the workplace, and the existence of good employment practices is a key contributor to economic competitiveness and social justice.

--- Later in debate ---

[Chris Stephens]

I will come on to that point. I found it curious in Committee that we were advised that e-balloting was unsafe and unsecure.

Amendment 15 would restrict the application of the provisions in clause 2 that introduce a 50% turnout requirement for industrial action ballots in addition to the current requirement for a majority vote in favour of action. The Government’s proposals will undermine constructive employment relations throughout the United Kingdom. Effective negotiations between unions and employers rely on equal bargaining power. The ability of unions to organise lawful industrial action ensures that employers take the views of the workforce seriously and engage in genuine negotiations.

The statutory thresholds will make it difficult for unions to organise industrial action, especially in larger workplaces and those with more dispersed workforces. As a result, the legislation is expected to have a wide-ranging impact on the ability of trade union members to take industrial action in defence of their jobs, working conditions and livelihoods.

It is in the employers’ and employees’ interests for disputes to be resolved quickly and amicably. The Government’s proposals mean that disputes are more likely to become protracted. The introduction of ballot thresholds will mean that unions will take more time in the run-up to ballots to ensure that there is the necessary turnout. That will inevitably divert time and effort from finding an amicable settlement.

[Mr Jim Cunningham]

This is one of those Bills that the Tories always bring forward when they are in trouble. More importantly, a lot of it has been brought forward because the Mayor of London has not been able to handle the industrial situation. As a result, the Tories are bringing in the Bill to undermine good industrial relations in this country.

[Chris Stephens]

I am very sympathetic to that point of view. The hon. Gentleman is right that the Mayor of London seems to have a different attitude from other public sector bodies across the UK.

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[Chris Stephens]

I agree with the hon. Lady, and that point was raised in Committee. We were told by Conservative Members that e-balloting is unsafe and insecure—I do not know what that means for the Conservative candidate for Mayor of London. It came out that a trade union could email an employer and the police about picketing. Presumably that is safe and secure.

[Mr Jim Cunningham]

Will the hon. Gentleman say something about stewards having to register with the police and wear armbands just as they did in the 1930s in the occupied territories in Europe?

[Chris Stephens]

We will discuss that at a later stage. The hon. Gentleman’s point is about the increased capacity for blacklisting that is contained in the Bill, and I agree with him.