Public Sector Pay Cap

John Bercow Excerpts

Wednesday 5th July 2017 Commons Chamber

[Hon. Members]

Withdraw!

[Mr Speaker]

Order. I know these matters pretty well by now. The right hon. Lady must resume her seat. I am sure that she has got a very versatile vocabulary, and she must deploy some other term. She cannot accuse a Member of being disingenuous; that is an imputation of dishonour. She has been in the House long enough to know that she should not say that. It is very simple, no debate required—a simple withdrawal. Thank you.

[Elizabeth Truss]

I do withdraw that, Mr Speaker, and apologise for it.

Perhaps the right hon. Gentleman was mistaken in what he said, because in 2015-16 we saw teachers get 3.3% worth of progression pay, we saw more than half of nurses and NHS workers get over 3%, and we saw military service personnel receive 2.4%. I therefore suggest that he include those facts in the figures next time he speaks. As for the fire service, he knows perfectly well that those pay policies are set independently and are covered within the local government budget.

I think it is wrong that we are hearing the Opposition talk down our public services when we are seeing huge improvements, we are seeing more people attracted into our public services, and we are seeing the best performance ever in our education system and our health system. As for uncosted commitments, the right hon. Gentleman has £60 billion worth.

The right hon. Gentleman asked about the pay review process. Well, the process is very simple. We have received recommendations from pay review bodies already this year. They make decisions based on the individual circumstances within those sectors. We have followed all of their recommendations. We will look at the further recommendations we need to make decisions on, and we will look at the balance between affordability and making sure that we retain and recruit high-quality public sector workers. This is the right approach. It is not saying that we are going to open up the cheque book, bankrupt our public services and see people lose their jobs, which is exactly what has happened in countries like Greece that took that approach and took their eye off the public finances. The right hon. Gentleman needs to take a more balanced approach in the way that he looks at this issue.

[Mr Speaker]

During the rather fractious proceedings to date, one Member has been the embodiment of calm and serenity. That Member should be imitated by others, and will now be called to contribute—Mr Kenneth Clarke.

[Mr Kenneth Clarke (Rushcliffe) (Con)]

Those are not adjectives that have been applied to me throughout my political career, Mr Speaker, but I am grateful to you for that credit. May I congratulate my right hon. Friend the Chief Secretary to the Treasury on straightforwardly restating the Government’s sensible policy on this issue? It is necessary as part of our ensuring, in this post-Brexit world, that we keep the economy on track; that steady, sustainable growth continues; and that we steadily eliminate the problem of debt and deficit that we inherited.

Does my right hon. Friend agree that if she were to give way to this week’s lobbying on the subject it would be a political disaster, because the Government would be accused of a U-turn and a surrender? It would set off a wave of pay claims across the entire public sector, which the Opposition are obviously looking forward to taking part in if they can provoke them. It might also be an economic disaster, and it would not be in the interests of the many people in the public and private sectors who are having economic difficulties in these times, and who want to look forward to a much more prosperous future as we get our economy back to health.

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[Rachel Maclean (Redditch) (Con)]

Does the Chief Secretary agree that as a result of Labour’s economic mismanagement in 2008 to 2009, average wages—[Interruption.]

[Mr Speaker]

Order. The hon. Lady’s question must be heard. Everybody in this Chamber must be heard. Let us hear Rachel Maclean.

[Rachel Maclean]

Thank you, Mr Speaker. As a result of Labour’s economic mismanagement in 2008 to 2009, average private sector pay fell significantly, while public sector pay remained stable. Does the Chief Secretary agree that it is important, when we look at the pay review bodies’ recommendations, to recognise the challenges faced by small businesses when they are outpaced by public sector earnings? Given that small businesses, as employers, create the majority of the jobs in this country, will she ensure that the pay review bodies take into account the views of small business people?

[Elizabeth Truss]

We have got to the position where public sector pay is comparable with private sector pay, and public sector workers often have pension entitlements on top of that. It is fair to get to a position where pay is comparable, for the skills people have. That is fair for the businesses that we need to create wealth in our country, so that we can fund public services. It is fair for workers in both the private sector and the public sector. Nothing is more important than getting people into work and giving them a sense of pride and responsibility, and the ability to earn for themselves and their family that come with it. The Government should be proud of what we have achieved: the lowest level of unemployment since 1975. The idea that we should put that at risk by making our public finances unsustainable or by pricing small businesses out of the market is very dangerous.

[Mr Speaker]

I see that the Father of the House is leaving the Chamber, but I hope that the calm and serenity that he brought to the Chamber will linger with us for some time to come.

[Rosie Cooper (West Lancashire) (Lab)]

This issue is also about fairness—a word I have heard repeatedly. Liverpool clinical commissioning group paid themselves increases of between 15% and 81%, with a non-executive getting £105,000. An NHS investigation has confirmed that that is far outside the rules, yet the accountable officer and governing body have not been held to account. Does that send a message from the Government to the NHS that people can do what they want, that anarchy rules and that the pay cap will be applied selectively and is not fair?

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[Mr Speaker]

Order. Mr Stephens, you are a very excitable denizen of the House. I had been intending to call you, but I think I will leave you to simmer down for a few minutes in the hope that you can recover such poise and composure as are available to you.

[Liz McInnes (Heywood and Middleton) (Lab)]

The Labour Government brought in Agenda for Change for NHS staff, which finally put us—I was one of those NHS staff—on a fair rate of pay with an independent pay review body, but since 2010 the coalition Government and the Tory Government have systematically undermined Agenda for Change pay rates by capping and freezing wages. The Government are all too ready to describe NHS workers as fantastic, but giving them a fair pay award is just that—fantasy. Is it not time that the Government put their money where their mouth is?

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[Several hon. Members rose—]

[Mr Speaker]

Order. I mean to accommodate remaining would-be interrogators, but questions and answers from now on need to be shorter. They have been becoming ever longer as the session has proceeded.

[Lilian Greenwood (Nottingham South) (Lab)]

Fifty-five per cent. of public sector workers are not covered by review bodies, including most of our civil servants and some of those on the very lowest incomes. Will the Chief Secretary give any hope that real pay rises will be considered for the 3 million public sector employees without a review body, and what will be the mechanism for doing so?

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[Elizabeth Truss]

The Labour Government left us with a huge deficit and a huge debt, which we have had to deal with over the last Parliament. It continues to hang over us, which is why the only path is the sustainable path of making sure we grow our economy, so we can enjoy even better public services and see people’s pay rise across the board.

[Mr Speaker]

Now that the hon. Member for Glasgow South West (Chris Stephens) has been sitting in a state of almost Buddha-like repose for some minutes, I think it is safe for the Chamber to hear from him.

[Chris Stephens]

Mr Speaker, as a passionate trade unionist for 20 years sometimes my emotions get the better of me.

Will the Chief Secretary confirm that pay is so low in some Government Departments that 40% of employees in those Departments are in receipt of tax credits? Will she publish, for each UK Government Department, how many employees are in receipt of tax credits?

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[Neil Gray]

On a point of order, Mr Speaker. At the start of these proceedings I failed to declare the fact that my wife is a primary school teacher, which I did when I asked a similar question during Cabinet Office questions. I apologise, and I thank you for allowing me to correct the record now.

[Mr Speaker]

I am grateful to the hon. Gentleman—as will be the House—for putting that on the record.