Public sector local pay 'institutionalises poverty'

Staff at the DVLA headquarters in Swansea would be among those affected by the introduction of local pay rates for public sector workers

Scrapping national pay rates for some public sector workers in the UK would "institutionalise" regional poverty, says union leader Mark Serwotka.

The Public and Commercial Services union general secretary said the move would mean public sector staff in Wales would suffer "poverty pay forever".

Chancellor George Osborne is expected to seek more flexibility in pay rates.

The Treasury says public sector pay in Wales is up to 18% higher than the private sector.

Plans to affect introduce local pay rates for 160,000 civil servants working in Jobcentres, the Driver and Vehicle Licensing Agency (DVLA), and border guards at ports and airports, are expected to be announced in this week's Budget.

Mark Serwotka says local pay rates for public sector workers would 'institutionalise' poverty

Local pay rates affecting up to six million public sector workers could be rolled out from next year.

Treasury officials say it would ensure the UK has "a responsive, modern labour force".

About 5,000 of the DVLA's 6,000 staff work at the agency's long-established Swansea headquarters.

In January this year, a report named Swansea and Newport as the two cities in Wales most likely to be vulnerable to rises in unemployment in 2012, due in part to their reliance on public sector employment.

Mr Serwotka said the chancellor's proposals to ensure a regional look to public sector pay would shrink Swansea economy at a time when businesses need people to be spending more money, not spending less.

Speaking on Radio Wales' Sunday Supplement programme, he said: "It can't be right to take on what are historical issues by just suddenly shrinking the pay of people because of where they live.

"It means that those parts of the economy that are not booming, and Wales is one of them, will always have lower pay rates, lower standards of living and those economies will never grow - they will shrink and what that will do is it will institutionalise poverty pay in places like Wales and the north of England."

Comparing the chancellor's expected announcement with the pay weighting some public sector workers have for working in London was a "smokescreen", said Mr Serwotka.

He said: "Work should be paid and remunerated on the basis of the jobs that you do, not because of where you are lucky or unlucky enough to live.

"That is unfair and actually what it will mean is that we will have lower pay rates in these parts of the country forever more."

'Needs to be addressed'

Vale of Glamorgan MP Alun Cairns told the same programme that regional pay and the wealth figures for the nations and regions of the UK were "completely separate".

He said: "There are some parts of the civil service that don't have pay bodies, and therefore this needs to be addressed and that's exactly that the chancellor is going to do."

"We have to live within our means."