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Devon MP: Regionalised public pay 'could lift West's economy'

By Western Morning News  |  Posted: June 22, 2012

Mel Stride

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A Westcountry Conservative MP has warned proposals for local public sector pay should not be "dismissed out-of-hand" as they could boost the region's economy.

Trade unions claim ending uniform pay for teachers, nurses and other public sector workers threatens to strip £140 million from the South West economy.

But Mel Stride, Conservative MP for Central Devon, said the Government is right to examine whether salaries for state workers are making it difficult for private sector firms to recruit staff.

Mr Stride said: "This should be very seriously looked at. It can't just be dismissed out of hand. To say public sector pay does not have an impact on businesses recruiting people is nonsense.

"I do get businesses saying this is happening. They compete with what others are paying in the market. In areas where wages are low, like the Westcountry, public sector pay is higher than in other areas. This cannot be ignored."

He was speaking after a debate on the contentious issue secured by Labour, which opposes the move.

But the Government insists the proposals are "not about cutting anybody's pay" or making further savings.

Chancellor George Osborne signalled his desire to end national wage rates and "localise" public sector salaries in his autumn statement.

The independent pay review bodies are considering the case for the change, but there have been concerns about the plan across the coalition Government, and signs that Downing Street was cooling on the idea.

In a low-wage economy like the Westcountry, critics have warned the measure would see public sector pay dragged down.

In the Commons, Alison Seabeck, Labour MP for Plymouth Moor View, said: "Despite the view commonly held, the South West has serious poverty. We may not have the dark satanic mills of the North, but there are certainly massive disparities in wealth, which will be further exacerbated should this proposal be rolled out nationally."

She added: "In the South Hams, the house price to income ratio is around 17-to-one. We should remember that many of the public sector workers who work in Plymouth and Exeter live in areas such as the South Hams.

"They might have struggled to get a mortgage on their dream home in better times, and they will be disproportionately hit by this Government's proposals on regional pay."

Stephen Gilbert, Liberal Democrat MP for St Austell and Newquay, said: "Cornwall is one of only four parts of our country that qualify for poverty-related grants from the European Union. It is sad to think that the 57,000 public sector workers in Cornwall could be facing another challenge."

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