Public sector pay: behind the headlines

The Belfast Telegraph has been looking at Civil Service pay again.

Behind the headline of a 3% increase in average Civil Service pay between 2013 and 2014 lie a few more facts.

The first one is that almost uniquely in the public sector, the Northern Ireland Civil Service treats the annual increment paid to all staff who have not reached the top of their payscale as part of the payrise.  In the police, for example, you would move up the payscale on the anniversary of joining the police or getting promoted, which on its own could be an increase of several percent, and then on a fixed date every year the payscales get increased.  That increase in the payscales is the one that hits the headlines, and by that measure the Northern Ireland Civil Service actually only increased payscales by just over 1% in 2013, and we know they are not giving any increase in 2014.

Some payscales were rejigged with higher increases in 2012, because equal pay settlements (made because different people were getting paid more for doing work of equal value and ranking) had caused some more junior staff to be paid more than their line managers.  Equal Pay actually accounts for quite a bit of the recent increases of Civil Service pay over private sector pay, as well as differentials with GB Civil Service staff.

Tables 1 and 2 of the NISRA report are the key ones which interests us.  The first note is the grade structure of the civil service:

 

GradeNumber of staff
Industrial1046
Administrative Assistant1624
Administrative Officer7819
Executive Officer 24479
Excutive Officer 13561
Staff Officer3355
Deputy Principal2584
Grade 71293
Grade 6265
Grade 5 and above246
Others1734

I would be lying if I said I wasn’t surprised by the number of staff in the higher grades, even though I know that includes professionals such as medical officers, accountants, computer programmers etc, whose skills come at a price.  It does however explain why the median wage is as high as £24,728, which is in the EO2 band.

The actual average (mean) wage is higher again at £27,860 according to table 2.  This tends to be the reality despite the number of staff in lower paid grades – proposals for voluntary redundancy schemes will make this worse, because as well as Mick’s note on maintaining the bureaucracy (something which I don’t think is entirely fair from experience) it always tends to be lower grades who leave, higher paid staff remaining.  This has been severely impacted over the last 10-15 years as cleaners, canteen staff and now some messengers and security staff have been outsourced to the private sector, which reduces the pay bill and the headcount, but also pushes up the average wage as these staff are inevitably low paid.

The short version is that to understand the disparity between public and private sector pay requires the reader to understand the pressures far beyond the trade union movement (who are furious about DFP imposing the 2014 pay “settlement” rather than negotiating) in terms of legal obligations which have pushed public sector wages up and with reference to privatisation of low paid jobs, but also the one I haven’t mentioned: to listen to the CBI you would think that the public sector is badly overpaid.

In my experience, this isn’t fair.  There are many businesses who couldn’t absorb higher wages for their staff, but should we not be concerned that other companies which could well afford to pay higher wages aren’t prepared to compete for staff in the public sector, because they’re more interested in making money and limiting pay bills than “rebalancing” the economy?  Have they noticed that cutting wages leads to less income for them?

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  • Billy Smith

    There are too many civil servants whose job is mainly second-guessing the decisions of others. The NICS should be subjected to a proper independent review of structure and processes with a requirement to produce 10% savings. An arbitrary voluntary redundancy package by itself will not be sufficient.

  • lily

    Yes I agree. And some of us are still waiting for our equal pay after 6 years

  • belfastconfetti

    Bless those good, underpaid and overworked people in the Civil Service.

  • Pat Mac Murphy

    Ahh, the following comments of the poor hard done by private sector employees who’ve been brainwashed by the kind hearted Tory govt. I see the divide & conquer strategy is alive and well. None of us get paid enough & conditions of employment should be better for us all.
    I’m not a civil servant btw.

  • kalista63

    I remember in the late 90’s and in to the noughties my private sector friends taking the pish out of my NHS wages and out of my other public services chums. At the time, a policy was introduced to give trained trade maintainance stance a supplement to their wages because they couldn’t attract them away from the private sector.

    Call Me Dave and Gideon make much of, we can’t punish the bankers because they’ll walk and go abroad. I’m only coming from the area I know best but healthcare staff are doing that very thing, thus we have a shortage of specialist nurses and doctors and are paying a fortune to plug the hole with agency staff.

    All staff are obliged to commit to continuous professional development. I don’t know if that follows in the civil service but along with a natural growing aptitude (you really should see how useless newly qualified staff are, (the educational system’s fault, not theirs). That is a most basic explanation of why there are increments.

    Remember, when Blair came in, recruitment was a trickle and he had to reform it to get new staff, which the ConDems are undoing.

  • streetlegal

    It is also worth remembering that the highest grades within the NI Civil Service (Principal Officer and above) are still mainly from a PUL background. This isn’t due to direct discrimination in recruitment or promotion, but is more of a cultural hangover from the old Stormont regime. To quote Katy Perry – ‘This is how we do’ – when filling these higher rank, higher paid posts.

  • Comrade Stalin

    Andy, you’re going to hate me for this, but the public sector have gotten off lightly. Compare with your counterparts to the south who have faced numerous levies and charges.

    Speaking personally, I would happily accept a pay cut in my private sector salary and bonuses (all of which are taxed at the upper rate) in exchange for the generous state-protected career average pension and job security that public sector workers enjoy.

    The more sensible part of the Belfast Telegraph’s feature on this yesterday suggested that the voluntary redundancy scheme needs to be careful that it isn’t too generous. I think the proposed scheme at the moment certainly is – it’s a pure waste of money throwing a pile of money at someone who will retire on a full pension within the next five years anyway. Natural wastage is the best way to reduce the cost of maintaining the civil service (of course, if our friends up on the hill had been sensible with financial planning this could have been implemented some time ago, avoiding talk of redundancy now).

    I know a few civil servants and they work very hard at what they do and take their job seriously, and I agree that these headlines about sick rates and pay raises are unfair. But you guys still have it pretty well made.

  • Comrade Stalin

    You don’t know what you are talking about.

    Private sector employees are most of the working class. People working in restaurants, bars, as cleaners or domestic staff, up to the professional lower end of the pay bracket such as nurses, plumbers, painters, electricians and so on.

    If you think it’s right to take taxes out of the pockets of such people and use them to pay office workers a generous salary and pension when they may be doing jobs that are not strictly necessary, that is your right, but please don’t try to pretend that you are defending the working man.

  • Comrade Stalin

    Tell you what, I’ll support your equal pay if you support an equal pension on the same basis as most of the private sector, namely defined benefits with a maximum of a 5% employer contribution. Deal ?

  • lily

    Certainly I support that as well, but as I haven’t always worked in the public sector, I understood that was why our wages were lower than the private sector to pay for our pension. Yes the private sector is better to work for, bonuses excellent wages, but they have to account for every penny they spend.

  • chrisjones2

    Just look at that table

    In any modern organisation there are basically 4 levels

    1 those who do

    2 those who maqnage the doing

    3 those who plan and manage the whole of operations

    4 those who manage strategically

    That’s it – the civil service have 11 grades to do the same thing.

    Whats more if you look at the grades only 10489 out of 28000 ie about 37% are the doers.

    The Senior Civil Service in England and Wales has 440000 staff of whom 4900 are Senior Civil servants.That is one Senior Civil servant per 12200 citizens and 1 civil servant per 136 citizens.The figures in NI and 1 Senior Civil servant per 6000 citizens and 1 civil servant per 57 citizens

    http://www.policy.manchester.ac.uk/resources/civil-servant/information/civilservicenumbers/

    I known these aren’t exact direct comparison but they show the broad picture.Pro-rata he local NICS is overstaffed by a factor of up to 100%.Bear in mind too that the UK Civil servants carry all the non reserved matters like defense that the local civil service don’t touch.

    The NI civil service is bloated and probably beyond repair.It has all the look and agility of a pregnant hippo.

  • chrisjones2

    See figures above. Perhaps 10% this year?

  • chrisjones2

    I understood that was why our wages were lower than the private sector to pay for our pension.

    They are not lower.In NI they are higher and they are kept higher because those on up the pyramid need to maintain the base under them

  • chrisjones2

    Can we see the evidence for that please?

  • streetlegal

    The old Stormont political regime did indeed fall in 1972. But the administrative regime carried on – and within the highest ranks of the NI Civil Service that old culture has carried on pretty much regardless from the days of Bloomfield right through to the days of McKibbin. Of course nowadays the chaps at the top must at least pay a certain amount of lip service to the equality agenda. But the cultural norms of the old Stormont have persisted within the top ranks of the NI Civil Service to the present day.

  • delphindelphin

    An extract from the NICS equality report of 2012
    ___________________________________

    What have been the greatest changes over time?

    2.13 Over the year 2011-2012 there was no significant change
    in the community background profile at the majority of grade
    levels – see Figure 7. The largest change was an increase in
    Catholic representation, and corresponding decrease in
    Protestant representation, at analogous Grade 5+ (2.7%).

    2.14 Over the period 2000-2012 there was an increase in
    Catholic representation at all grade levels. This increase was
    greatest at the more senior grade levels (18.2 percentage points
    at analogous Grade 6/7; 14.8 percentage points at analogous
    Grade 5 and above).

    —————————————————————————–
    Never let facts get in the way – much better having firmly held beliefs 🙂

  • Framer

    When the trade unions sell public sector jobs for redundancy money it means thousands fewer people in employment. Those people will now compete with the pre-existing unemployed and pick up new jobs before the under-experienced. And if they don’t seek work, they soak up benefits.
    Savings via redundancy payments overall are minimal, regardless of what the civil service advisers say. (They could not say otherwise given their conflict of interest.)
    But if a 10% cut in pay and pensions was offered up as an alternative, to protect and maintain jobs, we would have as much of a budget reduction. And fewer unemployed. It was done in the Republic and worked.
    Silly to suggest I know, as NIPSA has the politicians by the goolies. And will have until economic collapse looms. A labour aristocracy can never be dislodged except by revolution.

  • streetlegal

    Of course – the situation is in process of change due to the ever-tightening statutory regulation of employment practices since 1972. But the cultural norms at the top of the NI Civil Service have not yet given way. That might take another generation.

  • streetlegal

    But will there be enough pound shops and call centres to provide alternative employment for a crowd of grumpy former civil servants on the hoof – not to mention all those younger folks who might have expected to find their first jobs within the Stormont system. Somehow I don’t think so.

    Meanwhile – like there’s no tomorrow – things carry on regardless.

    https://irecruit-ext.hrconnect.nigov.net/

  • chrisjones2

    I just asked for the figures

    But as you did point us to them, lets look at the report on the whole – or as much as I can cram in here

    Justice. The latter group is predominantly male and predominantly Protestant, and the net effect of the changes in coverage has been to increase male
    representation (and reduce female representation) by 2.6 percentage points,and to increase Protestant representation (and reduce Catholic representation) by 2.2 percentage points.

    On the new basis of coverage, the composition of the Northern Ireland Civil Service (NICS) at 1 January 2012 was 50.2% male and 49.8% female. As regards community background, 52.8% of staff were Protestant and 47.2%
    were Catholica . So thats about right then?

    Over the period 2000-2012 female representation has increased by 1.9 percentage points, from 47.9% to 49.8%. While it remains the case that in general the more senior the level of job the lower the representation of females, there have been substantial increases over this period in the
    representation of females in senior grades, particularly at Grade 5 level and above where female representation has increased from 11.3% to 32.5%.

    Good progress then

    A similar pattern was evident, but less marked, in the case of community background, with the proportion of staff who were Catholic being highest in the most junior grades and lowest in the most senior grades. Since 2000 the NICS has seen Catholic representation rise, and Protestant representation
    fall, by 5.5 percentage points, a change close to that seen in the public sector as a whole (6.4 percentage points). The largest changes have occurred in the higher management grades (18.2 percentage points at Grades 6/7 and 14.8
    percentage points at Grade 5 and above).

    Again looks like good progress

    Analysis of recruitment competitions which had a closing date in 2011 indicates that at an aggregate level there were no inequalities in outcome with respect to gender and community background

    …and that looks fair.

    There are just too many of the buggers and a well designed thining down with a focus on top and middle grades will kill two birds with one stone

  • chrisjones2

    But the cultural norms at the top of the NI Civil Service have not yet given way.

    Given the figures above how do you justify that – and sf ministers have been in power for over 10 years so what have they done about it?

  • chrisjones2

    Evidence?

    I agree there are too many of them and many are insular and perennially useless but where is the evidence of bias that you suggest?

  • delphindelphin

    Senior management in the NICS is a self serving oligarchy. The absence of effective political control and the dominance of the public sector make their position secure.

  • Comrade Stalin

    I understood that was why our wages were lower than the private sector to pay for our pension

    Your pension is not “paid for” in the sense that people understand it. It is simply a charge on the state; future taxpayers will meet whatever the costs are. And they are significant.

    Local government pensions are not charged to future taxpayers; they’re paid for out of an investment fund, much like a defined benefits scheme in the private sector. The NILGOSC pension scheme – which is now a career average scheme – requires an employee contribution rate of around 5.5% and an employer (ie taxpayer) contribution of 20% – in other words, 25.5% of salary is required to keep the scheme solvent. This percentage has increased by 1% every year for the past few years.

    I doubt that your claims of that the public sector pays lower wages are true (I can’t believe that a public sector cleaner in an NHS hospital gets paid less than a contracted cleaner in a large restaurant or office) but even if they are, you might want to account for that 20% employer contribution which is effectively a top up on your salary.

    Yes the private sector is better to work for, bonuses excellent wages, but they have to account for every penny they spend.

    You say that like it’s a bad thing. Isn’t it right that organizations should account for every penny they spend ?

  • AndyB

    I don’t think there is such a thing as a public sector cleaner any more. They’ve all been privatised, and since they tend to be minimum wage staff, that pushes up average public sector wages. Go figure.

  • AndyB

    One thing NIPSA does not have is the politicians by the goolies, believe me.

  • AndyB

    The honest answer is that if civil servants don’t have jobs to go to, they’ll need a very generous package to go anywhere without being pushed, because redundancy payments only go so far.

    As for getting off lightly, that reflects the issue I mentioned in the article: is it actually true that public sector staff are overpaid, or is it that private sector staff are actually underpaid?

    Witness how many private sector staff are on tax credits etc because they cannot get enough hours or a high enough wage to get off them, and thus their employer is being subsidised to take them on. The battle to pay staff as little as possible may be good for the bank balance in the short term, but surely it’s self-defeating to restrict demand because your staff can’t afford your own products, while rich senior managers take the spare cash in bonuses and take it out of the economy rather than spending it.

  • streetlegal

    The NI Civil Service operates independently of the Executive. Cultural change at the top will come in time as more CNR civil servants eventually make there way to the top. But for the time being and forseeable future those PUL cutlural norms will remain in the ascendancy.

  • barnshee

    “But for the time being and foreseeable future those PUL cutlural norms will remain in the ascendancy.”

    If that were the case the Equality commission would be overrun with complaints of discrimination – it appears not to be

  • streetlegal

    Because, as I said at the top, this is not due to direct discrimination. This cultural norm at the very top of the NI Civil Service is a hangover from the old Stormont regime when CNR candidates would not even have been considered for the top posts. In time the balance which has been achieved in the lower ranks will become established in the highest ranks also. But that will take many years to come through and until then PUL cultural norms will remain at the head of the NI Civil Service.

  • AndyB

    The problem is that because NICS is entirely separate from the home Civil Service, it has to replicate all of its functions from scratch, and it has been that way since its inception. Amalgamation into the Home Civil Service would save relatively little since most of the functions would still need to be replicated in each department.

    What would be interesting are the comparative figures for Scotland and Wales. They should have a lower ratio than NI as different things are devolved (for example, of the four biggest departments, only the work of DWP and Justice are devolved, and even then only in NI) but devolution should still mean that the ratios of civil servants to population are higher than in England.

  • barnshee

    What “cultural norm” stops CRN`s being promoted
    Why has these “cultural norms” not produced cases at the EQ?

  • streetlegal

    CRNs are being promoted and gradually balance is coming into all of the ranks. But the last place we will see balance emerging is at the very top. Because the top jobs and those directly in line for those jobs are predominantly held by civil servants from a PUL background. That is why it will take many years for the PUL cultural norms operating right at the top of the NI Civil Service to give way.