More proof that state workers do better

ANOTHER report has confirmed that public sector staff are paid more than those in the private sector.

The study, by the Social Market Foundation, comes amid calls for the cap of 1 per cent on public sector pay rises to be lifted.

The think-tank found that, on average, those in the private sector earn £9 a week less than public sector staff.

Workers from all backgrounds are £300 a year worse off than they were in 2016 thanks to rising inflation. But the effect is harder on those in the private sector. The SMF’s analysis of yesterday’s Office for National Statistics earnings figures show that, on average, both private sector and public sector workers have seen their real earnings fall over the past 12 months.

Average gross earnings for July 2017 were £505 a week. Combined with the latest inflation figures, workers are £309 a year worse off than in July last year.

Private sector workers earned £503 a week on average in July 2017, which represents a £305 fall in annual income compared with a year ago.

In the public sector, average gross pay was £512 a week; with inflation rising, they earn £258 less than they did a year ago.

SMF chief economist Scott Corfe said: ‘After adjusting for inflation, workers are significantly worse off than they were a year ago. In part this reflects the increase in the cost of living as a weak currency has pushed up the price of imported goods.

‘But it also reflects weak earnings growth, which remains stubbornly stuck in the doldrums. Improving productivity to boost pay is absolutely critical.

‘With total pay growth lower in the private sector than the public sector in July, the Government will be under more pressure to boost the pay of all workers.

‘Lifting the public sector pay cap benefits less than a fifth of the workforce.’

At the weekend a study by the TaxPayers’ Alliance found public sector workers are 11 per cent better off on average than those in the private sector, as well as working shorter hours and taking more sick leave.

LISTENING to the shroud-waving BBC, anyone might believe public sector workers have borne the lion’s share of the pain since the financial crisis. Reports from two separate bodies tell a different story.

First, the Taxpayers’ Alliance found public employees remain on average 11 per cent better paid than those in the private sector. Now the Social Market Foundation reports that workers for private firms lag £9 a week behind, having suffered a fall in real income of £305 over the past year. By contrast, those on the state payroll (who enjoy far more generous pension rights) have lost only £258 in spending power.

Yes, in isolated cases there may be arguments for easing the 1 per cent cap on public sector pay. But any awards should be accompanied by imaginative schemes to fund them, such as regional pay bargaining.

Merely reaching for the Treasury’s cheque book and adding to our debt mountain, in the hope of avoiding a wave of strikes, would be a gross betrayal of our children and grandchildren.