Public sector pay: not all wishful thinking

A recent survey on public sector pay has, contrary to popular media opinion, revealed that employees are not living in a bubble - or on big bonuses when it comes to their remuneration

Just before Christmas, the Chartered Institute of Personnel and Development (CIPD) published its annual report on attitudes to pay and bonuses.

The finding highlighted by the media was the suggestion from the CIPD that public sector workers are failing to see storm clouds gathering over public sector pay, largely because they are still expecting a pay rise this year.

It was subsequently pointed out, by Alastair Hatchett, the head of pay services at Incomes Data Services, among others, that this was not an entirely accurate reading of the results and that public sector staff are all too well aware of the difficult times ahead for pay and conditions.

Public sector attitudes to their pay

In fact, a more detailed look at the report reveals a number of interesting findings about public sector attitudes to their pay. It is true that 76% of public sector staff in the survey received a pay rise in 2009, compared to a mere 40% in the private sector, but that is largely due to the number of multi-year pay deals in the public sector.

This has been portrayed as a story of public sector staff living in a bubble, cut off from reality. In fact, the report shows that both public and private sector staff are likely to expect a better pay rise this year than last, and employees in the private sector are more likely than their public sector counterparts to expect a higher pay rise this year.

In addition, media outrage over bonuses for public sector workers fail to reflect the wider situation on bonuses. In the CIPD survey, under a third of all organisations, both private and public, had a cash bonus system in place in 2009, and of those, just 11% were public sector bodies. So even though performance-related pay has increased in some parts of the public sector, very few public servants are receiving bonuses.

There were interesting findings, too, on transparency of public sector salaries, which is one of the planks of Conservative policy. Last year, Conservative party leader David Cameron said his party would publish details of all public sector salaries over £150,00. The survey shows that most public sector employees support the idea of sharing information about their pay. But that enthusiasm wanes among more senior staff.

Those with no managerial responsibility are more likely to agree to share their information than middle managers and above.

There is one aspect of pay dissatisfaction that remains puzzling - but it's not exclusive to public sector staff.

The CIPD survey notes that the biggest single cause of dissatisfaction with their pay increase among staff was the fact that their increase failed to keep pace with inflation - despite the fact that the official inflation figure was negative for most of 2009. Conversely, more public sector staff than private employees felt their increase had kept their salary ahead of inflation and reflected the state of the economy as a whole.

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