Three-year deal carries uncertainty
THE Policy & Resources Committee's very generous offer of a three-year pay deal to the public sector may have caused some surprise – topped only by the revelation that some pay groups have turned it down.
True a 5% increase plus £500 offered for 2022 is below the current cost of living, but it compares favourably with an annual increase of 2.3% for June 2021, the date the States now works from, and for the rest of 2021.
The 5% element alone of the current offer increases the States’ wage bill by more than £12m., with the almost-guaranteed prospect of worse to come for the taxpayer in 2023, with inflation not expected to fall any time soon.
True, much of the public sector did not get a pay rise in 2021 – many others didn't either – and while P&R appears to be playing hardball in further negotiations, the overall message on States’ pay seems to have altered rather a lot over the past 18 months.
In December 2020 P&R warned the States was spending more than it could afford, ‘we cannot allow those costs to continue to rise’ and ‘cost control is more vital than ever’.
A warning of uncertainty was also made, linked to Covid, but a two-year commitment on the cost of living at a time of high inflation, with apparently no other strings attached, surely introduces further uncertainty for taxpayers funding it, and for the bottom line of the ongoing tax review.