Osborne's plan to undermine public services, move money from poor to prosperous areas

By Bernadette Meaden
January 12, 2012

George Osborne has come up with a policy that could simultaneously undermine public services and redistribute money from poor areas to prosperous ones.

At present, public sector workers are paid the same for doing the same job wherever they work in the UK. The government thinks it would be a good idea to change this, varying pay to match the local cost of living. This might sound logical, but the implications for public services, and for the least wealthy areas of the country, are depressing.

Firstly, one can be sure that when it comes to implementing such a policy, the government will be reluctant to increase pay in the most expensive areas, but will be positively enthusiastic about cutting it for those in less prosperous areas. No doubt George Osborne thinks teachers and nurses in the North East or Merseyside are living in the lap of luxury, and would be able to manage on much less. But if public sector pay is cut in less prosperous areas, those workers will have less to spend on goods and services, local businesses will suffer a drop in income, and a relatively poor area will become even poorer.

If workers are forced to negotiate for their pay on a local rather than a national basis, they will be in a far weaker position. This helps to explain the unseemly haste with which Michael Gove is pushing schools into becoming Academies. These schools are not bound by national pay agreements, and the subsequent fragmenting of the education system will serve to make it more difficult for teachers to defend their pay and conditions.

As private companies make inroads into the NHS and the Prison Service, pay and conditions there will be eroded too.

Over the past few years there has been a barrage of propaganda asserting that with their ‘gold-plated’ pensions and unjustifiably high pay, public sector workers have had it too good for too long. But these statements are very misleading.

The perceived higher level of pay in the public sector can be explained by both the nature of the work carried out and the nature of the work force itself.

In recent years, much of the low skilled work that used to be done in the public sector has been outsourced to private companies, leaving a workforce that is generally older and more highly qualified. For instance, in 2010, 38 per cent of workers in the public sector had a degree or equivalent qualification, compared with 23 per cent in the private sector.

These highly qualified workers have skills that are needed all over the UK, so can often choose where they want to locate. If they go to work in a relatively poor area, which may be more challenging professionally, at least they know that housing will be more affordable and their budgets will be less stretched. If they know that by moving from a prosperous area to a deprived area, they will be penalised with a pay cut, why would they do it?

Nobody would deny that many people who work in the private sector shoulder great responsibility, but on the whole, society’s most crucial and responsible jobs tend to be done in the public sector. Doctors, nurses, teachers, police officers, judges, social workers: when people in these jobs get things wrong the consequences can be disastrous - particularly for society's most vulnerable people.

We are fortunate that, for the moment, there are enough people able and willing to take on these responsibilities. But if the government doesn’t stop chipping away at their morale and their standing in the community, we may find that one day we just can’t get people to do it any more.

A survey at the end of last year showed that public sector employers are increasingly worried about attracting and retaining staff, and there is already quite a problem with the recruitment of head teachers.

The difficulty is often most acute in deprived areas, so paying less in these areas will only compound the difficulties. Areas that are already disadvantaged may experience a ‘brain drain’, depriving them of the much-needed skills and economic contribution of talented people.


© Bernadette Meaden has written about religious, political and social issues for some years, and is strongly influenced by Christian Socialism, liberation theology and the Catholic Worker movement.

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