A deep split has emerged between local government leaders over the employers’ decision last week to increase the pay offer to unions.
The Conservatives, who opposed the rise, are furious at being out-voted by the opposition parties, despite their majority control of the LGA, while England’s largest council, Birmingham City, is now calling on the offer to be withdrawn.
Birmingham City Council chief executive, Stephen Hughes, has e-mailed West Midlands chief executives to ask them to jointly call on the Local Government Employers to withdraw the offer of 1%.
In his letter sent last Friday, Mr Hughes said: ‘In the current economic climate, there can be no justification for any pay award. The LGE is, in my, view completely out of touch with the magnitude of the economic challenges facing authorities, and how public opinion will react to this offer.’
He said he was also ‘concerned’ at the lack of formal consultation before the revised offer was made, replacing an earlier offer of 0.5%, which was rejected by the unions.
Birmingham City’s HR director, Andy Albon, is also arranging a meeting with regional HR heads to consider their options, including withdrawing from national bargaining. He told The MJ: ‘We’d have expected the national employers to have held the line on 0.5%. To award ourselves money is inappropriate at a time of high unemployment.’
But opposition to the new pay offer – which equates to £240m on top of local government’s £24bn pay bill – is not limited to Birmingham, a Tory-led council.
An official LGA statement last week revealed the proposed deal was passed by a ‘majority vote’ among town hall representatives on the National Joint Council (NJC). A separate letter, sent to union leaders by the employers, warned staff the 1% offer was ‘final’, and that ‘employers have given considerable and prolonged thought to the difficult, and worsening, economic position facing local authorities’.
In reality, that reflected a clear political split between employers. Smith Square sources said ‘the vast majority’ of Conservative-controlled councils opposed the new offer, and instead wanted to freeze staff pay for 2009/10.
The MJ understands the three Conservative members on the employers’ side of the NJC, as well as the representative from the Welsh LGA, opposed the deal. However, the Labour, Liberal Democrat, Northern Ireland and independent employer members supported the offer.
Conservative-controlled London boroughs have vociferously opposed any improved pay deal. They claim they do not have the revenues to cover additional pay rises because they are close to the Government’s grant settlement ‘floor’.
‘It’s no exaggeration to say some
London boroughs will genuinely struggle to cover any new commitments,’ one senior source said.
‘Nationally, we’re now in a position where the Conservatives control almost two-thirds of English councils, and yet have no influence over national pay settlements.’
Sources at Conservative central office, which administers the national party, said the situation regarding local government pay was ‘an anomaly that needs addressing’.
Local government trade unions representing 1.6 million staff this week tacitly backed the employers’ improved pay offer – which will mean 1.25% increases for the lowest-paid workers, an increase from 20 to 21 days’ annual holiday entitlement, and the establishment of joint guidance on future redundancies.
Unison, the GMB and Unite issued a joint statement on 28 July urging members to accept the ‘best available offer through negotiation’.
Union members must respond to the consultation by September, and the pay award will be backdated to April.
Heather Wakefield, Unison national secretary for local government, warned the implications for councils that opt-out of the NJC negotiating process could be ‘severe’ because ‘they may end up “leapfrogging” each other over pay issues, as they compete for staff, thereby driving up costs further.’
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