The Public Services Commission (PSC) has released the following statement after the recent pay award offer to PSC employees:
The PSC says there must now be pay restraint, with indications that public sector pay is now outstripping pay in the private sector.
Analysis in a recently published earnings survey shows a significant gap between public and private sector pay, although the report makes clear that a like-for-like comparison is difficult.
There have been significant PSC pay awards in recent years: In 2022/23 the pay award offered and agreed was 6%, followed by another 6% pay award in 2023/24.
With inflation having fallen to around 2%, the PSC has offered a pay deal of a 2% increase in each of the next three years.
This comes with the option for the third year to be renegotiated if CPI is 1% higher or lower than 2%.
A three year pay deal brings certainty and timely application of pay awards for PSC employees and assists government departments in budgeting.
Pay claims from unions for this year have varied, initially at 8.33% (Prospect) and the equivalent of 7.7% (Unite). More recently, in April Prospect has revised its claim to 4.5% in recognition of inflation coming down.
This more recent position shows that there is not a huge gap between the offer made by the PSC last week, as a multi-year offer, and claims received.
If a pay award was to be made in the order of the unions’ claims made for 2024/2025, it would represent an increase to PSC pay approaching 20% within a 3 year period, a position which most people would not consider reasonable or realistic.
Each 1% increase in the PSC wage bill alone costs the taxpayer in excess of £1.5 million, without taking into account national insurance and pension contributions.
Chair of the PSC, Kate Lord-Brennan MHK, said:
‘A key priority is a focus on financial responsibility for government departments. Pay and staffing budget is often the biggest area of spend and so there cannot be year on year large increases in terms of pay awards at this stage without impact on funds available for services for the public.
‘There is now, for various pressing reasons, a balance which must be struck.’
‘Whilst fair pay and terms should of course be taken into account, there is also a wider view to be considered, and now balanced, between the cost of the public sector and the economy. Part of that is to consider the impact of increased government spending, which is funded by the taxpayer, and what the economy can afford.’
A Joint Working Party has also been proposed by PSC to look at some broader matters relating to PSC Terms and Conditions.
Negotiations are continuing and the PSC looks forward to engaging positively with Prospect and Unite, and is keen that PSC employees can get certainty in terms of pay increases for this year and future years, within what is affordable and reasonable.
PSC letter
The letter to PSC employees is below:
Dear colleagues,
The Public Services Commission (PSC) wishes to provide an update in respect of negotiations with regards to the PSC pay award for 2024/25.
Following consideration of submitted trade union claims and the financial circumstances, the PSC has made an offer of a multi-year, consolidated, percentage increase covering three years as follows:
2024/25 2%
2025/26 2%
2026/27 2% *
*With the caveat that should March 2026 CPI be 1% higher or lower than 2%, the offer of 2% becomes void and we would re-open negotiations for this year.
This would apply to allowances and local agreements, where these refer to payments being increased by the same percentage as the pay award.
The increase for the current year would be backdated to 1 April 2024 for all PSC employees who are employed on the date the pay agreement is signed by all parties.
This means that any member of staff who had ceased employment prior to that date would not be entitled to receive any arrears from the pay award.
This offer was sent to the unions Prospect and Unite on 5 June 2024.
If accepted, and provided Payroll, Office of Human Resources, receives notification by close of business on 26 July 2024, this pay award could be implemented and arrears of salary would be paid in August 2024.
There are significant benefits in a multi-year deal for both staff and the budget holders. For staff in particular, this provides certainty that pay awards would be implemented and paid in April 2025 and April 2026 providing a continuity of pay award application.
For budget holders, having certainty about the percentage increases will enable better financial planning for the next three years, which is especially important given financial constraints in the public sector and the government commitment to financial discipline.
In addition to the above, a Joint Working Party has also been proposed to look at some broader matters relating to PSC Terms and Conditions.
Public Services Commission
4 Comments