Treasury written question – answered at on 19 April 2012.
To ask the Chancellor of the Exchequer with reference to the Financial Statement, what assessment he has made of the likely effect on (a) numbers of private sector jobs and (b) private sector growth rates of the introduction of regional pay rates for the public sector.
At autumn statement 2011 the Government asked the independent pay review bodies to consider how public sector pay can be made more responsive to local labour markets. The review bodies will report from July.
Until formal proposals have been made by review bodies it will not be possible to assess the specific effect on private sector employment or growth.
However, the Government believe that local, market-facing public sector pay should support local areas, with the potential to support a greater number of public sector jobs for the same level of spending, and help local businesses become more competitive and expand. The Government's evidence on the economics of local pay is available online via the Office of Manpower Economics at:
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