Pressure mounts on Treasury in row over local pay

FURTHER pressure will mount on the Government today to drop its controversial plans for local pay bargaining after Labour secured a major Commons debate amid fears poorer areas will be hit hardest by the policy.

This afternoon politicians will discuss the increasingly toxic proposal from Chancellor George Osborne that public sector workers should be paid less in low-wage areas, in an attempt to drive private sector growth in the regions.

Unions have savaged the idea amid fears it would inevitably mean public sector wages being held down across large parts of the North for many years. Senior executives, including the chief of Leeds City Council, have also hit out against the proposal,

Hide Ad
Hide Ad

With most Liberal Democrats and many backbench Tories from low-wage areas also uneasy, Downing Street signalled a possible retreat this week when a spokeswoman said the measure would only be introduced if it was supported by “strong evidence”.

Scenting the possibility of yet another Treasury U-turn, Labour secured an Opposition Day debate on the measure.

Shadow Chief Secretary to the Treasury and Leeds MP Rachel Reeves said: “George Osborne has been very clear that he wants to move to localised pay bargaining – despite the evidence that it will prove costly to the public purse and exacerbate regional inequalities.

“If the Government really is thinking again it would be welcome, but some Conservative MPs are urging the Treasury to press ahead.

“MPs from all parties and every part of the country who oppose these plans should vote for our motion and force another U-turn from this increasingly embattled Chancellor.”