NHS pay review body: twenty-sixth report 2012 - Official Documents

1.7
1.8
1.9
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this as basic salary of a full time equivalent employee not including overtime or any
regular payments such as London weighting, recruitment and retention premia or
other allowances. Review Bodies were invited to consider the size of the uplift for those
earning £21,000 or less with the Government seeking an uplift of at least £250. In doing
so, Review Bodies may want to consider progression pay, affordability, the potential
for payments to be more generous for those on the lowest earnings, and how best to
avoid “leapfrogging” of those earning just under £21,000 with those earning just over
£21,000.
The Chief Secretary to the Treasury’s letter added that the UK Government had accepted
the recommendations of Lord Hutton’s report on the future of public sector pensions4 (see also paragraphs 1.23 to 1.24) as a basis for consultation on this issue. These included
a recommendation that the UK Government make clear to Review Bodies that they
should consider how public service pensions affect total reward and the UK Government
would return to this issue in advance of the 2013/14 round. However, the UK
Government’s view was that any changes to pensions, including the proposed increase in
contributions from 2012/13, did not justify upwards pressure on pay.
The Secretary of State for Health confirmed the remit in a letter to us on 22 August
2011. He added that the Department of Health would submit evidence to support the
process including, as necessary, evidence on high cost area supplements, recruitment
and retention premia, and information on other aspects for those earning more than
£21,000.
The Minister for Health and Social Services in the Welsh Government wrote to us on
18 September 2011 confirming the same remit as the Chief Secretary to the Treasury had
outlined and confirming the provision of evidence, as necessary.
1.10 The Minister for Health, Social Services and Public Safety in Northern Ireland wrote on
27 September 2011 confirming that the two-year pay freeze for public sector workers
would apply in 2012/13 but recognising that there would be an increase of at least
£250 for Health and Social Care staff earning £21,000 or less subject to the Review Body
process in the usual way.
1.11 The Deputy First Minister and Cabinet Secretary for Health, Wellbeing and Cities
Strategy in the Scottish Government also wrote to us on 30 September 2011 confirming
Scotland’s public sector pay policy including: a pay freeze for all staff except those
earning £21,000 and below; supporting lower paid staff by uprating the Scottish Living
Wage to £7.20 per hour from 1 April 2012; and a commitment that all staff earning
less than £21,000 should receive a minimum annual pay increase of £250. The Scottish
Government sought recommendations from us on uplifts within the parameters of its
public sector pay policy.
1.12
The remit letters from the UK Government and each of the Devolved Administrations are
at Appendix A.
5 1.13 We commented in our Twenty-Fifth Report on the constraints placed on our
deliberations by the four Governments’ approaches to public sector pay. While we
are aware of the economic circumstances and the four Governments’ approaches to
managing public finances, we have experienced a significant period where our ability
to consider our full terms of reference has been limited. Following the end of the UK
Government’s policy of a public sector pay freeze, the Chancellor has announced that
there will be a further period of public sector pay restraint in 2013/14 and 2014/15
(see Chapter 6). We welcome the Chief Secretary to the Treasury’s acknowledgement
4
Independent Public Service Pension Commission: Final Report (10 March 2011). Available at:
www.hm-treasury.gov.uk/pensionscommission.
5
NHSPRB (2011), Twenty-Fifth Report, TSO (Cm 8029), paragraph 1.11.