We are all in this together, well not if you are in a union.

marklv

MrsE wrote: »

I am a very junior manager, a drop in the ocean.
But there is no more money, there is less.
If people insist on pay increases the only way to afford it will be job losses.

I am all in favour of pay restraint in the public sector, but imposing 1% ceilings on pay budgets for two years is not the way forward. This is brutality, not pay restraint. All the chancellor needed to do was to announce say a freeze on payband increments or something like that, not an across the board imposition of a real pay cut after taking inflation into account.

chewmylegoff

marklv wrote: »

I never said it was OK for private sector workers to have their pay frozen - I really wish nobody's pay was frozen, of course. But the public sector operates differently and the reasons for company pay freezes/cuts don't apply here. There are no shareholders for the NHS, the Police or the Civil Service - these are not profit making businesses that have to make money for shareholding organisations. Why do you think that hurting public sector workers is going to do any good, other than make you feel better? If you are so jealous of public sector workers then by all means apply for employment in this area - you'll soon find that it's not all wine and roses.

of course the same reasons exist

private sector, your costs outweigh your turnover, you have to cut costs.

public sector, your costs outweigh your income from taxes, you have to cut costs.

currently there is an enormous budget deficit in the public sector. its income is outweighed by its costs to the tune of £170 billion.

if you don't cut costs your options are:

ramp up direct taxes (private sector workers who have had their pay frozen pay for your payrise, public sector payrise is meaningless because they just change the maths on your payslip so your gross is larger but your takehome remains the same)

ramp up indirect taxes (public sector payrise becomes irrelevant because you pay it out in more tax, private sector workers pay more tax despite their frozen pay

borrow even more money (more direct taxation in future years to pay the interest on the debt, private sector workers in the future pay for your payrise now)

so which is it? whichever scenario you choose you are expecting private sector workers to pay more tax so you can have more money.

realistically you have to cut costs (e.g. below inflation increases to public sector payroll) and increase taxes.

marklv

Kohoutek wrote: »

I know, but you were trying to suggest John Lewis' bonuses are an illustrative example or typical experience for ordinary workers in the retail sector and the reality is the opposite - they are an anomaly.

The reason John Lewis pays bonuses is that it is not a company - all the employees of the firm are the owners and therefore share the profits. The overwhelming majority of private sectors employees work for companies - where the profits of the businesses are distributed to the owners/shareholders and the management (in the case of a small business, often the same person), not the workers.

Fair enough.

Kohoutek wrote: »

Bonuses is the private sector are the exception rather than rule too, in fact for the vast majority they are an impossibility. Are you continuing your delusional belief that bonuses are normal amongst ordinary private sector workers?

It depends on the industry. In the banking industry bonuses are a very important part of the package - I once worked for RBS (retail, not investment banking) in the early 00s and staff were told that they would get a 'virtually guaranteed' 10% bonus every year as part of their package. The bonus was non-contractual but HR made it out to be practically a guarantee.

chewmylegoff

marklv wrote: »

I am all in favour of pay restraint in the public sector, but imposing 1% ceilings on pay budgets for two years is not the way forward. This is brutality, not pay restraint. All the chancellor needed to do was to announce say a freeze on payband increments or something like that, not an across the board imposition of a real pay cut after taking inflation into account.

imposing 1% ceilings on pay budget increases is not brutality. cutting pay by 25% is brutal.

freezing payband increments just freezes the salaries of all staff who are at the payband, whilst allowing those below them to have increases. you wouldn't happen to be in the middle of a payband would you?

marklv

chewmylegoff wrote: »

of course the same reasons exist

private sector, your costs outweigh your turnover, you have to cut costs.

public sector, your costs outweigh your income from taxes, you have to cut costs.

currently there is an enormous budget deficit in the public sector. its income is outweighed by its costs to the tune of £170 billion.

if you don't cut costs your options are:

ramp up direct taxes (private sector workers who have had their pay frozen pay for your payrise, public sector payrise is meaningless because they just change the maths on your payslip so your gross is larger but your takehome remains the same)

ramp up indirect taxes (public sector payrise becomes irrelevant because you pay it out in more tax, private sector workers pay more tax despite their frozen pay

borrow even more money (more direct taxation in future years to pay the interest on the debt, private sector workers in the future pay for your payrise now)

so which is it? whichever scenario you choose you are expecting private sector workers to pay more tax so you can have more money.

Cutting costs, as I pointed out before does not necessarily mean imposing pay freezes. And I woud rather see certain public sector bodies or quangos close altogether than for people in the public sector who do vitally important jobs like teachers, nurses, junior doctors, police and our brave armed forces to be slapped in the face with pay freezes. We rely on these people, who do thankless, unpleasant jobs and endless hours, to educate our children, protect our health and protect us from criminals and hostile foreign governments - do we really need to insult them like this? So the private sector is suffering? Oh dear, how sad! Some bankers lose their six-figure salary jobs? Ah, my heart bleeds for them. Some shop assistants get the push? They can always find something else to do. We need to get our priorities right as a nation and not always try to find ways of punishing others to make us feel better. Where is our national solidarity?

Kohoutek

marklv wrote: »

It depends on the industry. In the banking industry bonuses are a very important part of the package - I once worked for RBS (retail, not investment banking) in the early 00s and staff were told that they would get a 'virtually guaranteed' 10% bonus every year as part of their package. The bonus was non-contractual but HR made it out to be practically a guarantee.

I know, absolutely right, but the guaranteed bonus package for investment bankers is very unusual. It doesn't even exist in other City professionals like the legal or accountancy industry. Let alone the entire private sector, where for the great majority will never receive a bonus in their entire working life.

The compensation structure for investment bankers can't be used to make assumptions about the whole private sector. That's like me saying that because a council chief executive may have a pension pot of £1 million, all public sector workers must have huge pension pots.

marklv

chewmylegoff wrote: »

imposing 1% ceilings on pay budget increases is not brutality. cutting pay by 25% is brutal.

freezing payband increments just freezes the salaries of all staff who are at the payband, whilst allowing those below them to have increases. you wouldn't happen to be in the middle of a payband would you?

Cutting pay by 25% is not brutal, it's criminal. It's what could be termed 'creative dismissal' by making the job worthless in reward.

When I said feezing payband increments I meant for all staff, not just those in the middle or near the top of the grade bands. It would still mean that cost of living increases would be given, but no other increments or non-consolidated payments. That would be a much fairer way to restrain pay budgets.

chewmylegoff

marklv wrote: »

Cutting costs, as I pointed out before does not necessarily mean imposing pay freezes. And I woud rather see certain public sector bodies or quangos close altogether than for people in the public sector who do vitally important jobs like teachers, nurses, junior doctors, police and our brave armed forces to be slapped in the face with pay freezes. We rely on these people, who do thankless, unpleasant jobs and endless hours, to educate our children, protect our health and protect us from criminals and hostile foreign governments - do we really need to insult them like this? So the private sector is suffering? Oh dear, how sad! Some bankers lose their six-figure salary jobs? Ah, my heart bleeds for them. Some shop assistants get the push? They can always find something else to do. We need to get our priorities right as a nation and not always try to find ways of punishing others to make us feel better. Where is our national solidarity?

you just completely and continually ignore the fact that noone in the public sector can be paid without tax revenues. you can't cut a £170 billion budget deficit by laying off a few consultants. you have offered no meaningful solutions - the reality is that you need to control costs across the board and increase tax revenues.

the public sector has had a good deal under labour. a lot of the money that has been put into the public sector has been used to increase public sector salaries at faster than the rate of inflation. the result is that public sector workers are now paid, on average, more than private sector workers. when there is no money in the till, you have to take the flip side of the coin and receive real terms cuts. you can't expect the private sector to keep paying more tax so you can have more money.

your solution is just to increase everyone's pay because they do important jobs and worry about it later. great plan, but that's not really a solution. everyone has to take the pain, including you, so learn to deal with it.

chewmylegoff

marklv wrote: »

Cutting pay by 25% is not brutal, it's criminal. It's what could be termed 'creative dismissal' by making the job worthless in reward.

When I said feezing payband increments I meant for all staff, not just those in the middle or near the top of the grade bands. It would still mean that cost of living increases would be given, but no other increments or non-consolidated payments. That would be a much fairer way to restrain pay budgets.

no, a much fairer way is that you don't receive cost of living increases when there is no money to pay for them.

cutting someone's salary by 25% is not criminal at all, even on your terms, as constructive dismissal is a civil matter not a criminal offence. in any case, many have had to take that sort of cut in the private sector - a cut you call criminal. you want them to pay more tax so you can have a payrise. that's not "criminal", i suppose.

marklv

Kohoutek wrote: »

I know, absolutely right, but the guaranteed bonus package for investment bankers is very unusual. It doesn't even exist in other City professionals like the legal or accountancy industry. Let alone the entire private sector, where for the great majority will never receive a bonus in their entire working life.

The compensation structure for investment bankers can't be used to make assumptions about the whole private sector. That's like me saying that because a council chief executive may have a pension pot of £1 million, all public sector workers must have huge pension pots.

OK, but the point I was trying to make is not solely to do with bonuses, but the difference in potential reward. So that, say, an accountant or lawyer working in the public sector is bound to have less potential for earning 'big money' (however you define it) than the same professional working in the private sector. You can't become a partner while working in the civil service or local government as these are not profit making businesses, so your earning ceiling will awlays be lower. OK the pension schemes are better but that still doesn't make up for the loss of potential earnings. It's not surprising that it's mainly women professionals who opt for the public sector, as this is an area that offers more flexible working conditions and work-life balance than in the 'cut and thrust' of private business.