Thursday, 13 May 2010

Leading by example - the UK and Jersey

David Cameron today redeemed his first pre-election promise by announcing that all ministers in his Lib-Con coalition will take a five-year pay freeze, as well as a 5% pay cut. (1)

This forms part of a whole package, as he said in his own words

We need to control public spending as part of our plan to reduce our deficit. We must find ways to cap the biggest government pensions. This cap should prevent any taxpayer-funded increase in government pensions already worth over £50,000 a year. We've also said we need a public sector pay freeze for everyone apart from the million lowest paid workers.

But it's also important that we show leadership in Westminster. As well as closing the MPs' pension scheme to new entrants, we need to cut ministers' pay by five per cent, and freeze ministerial salaries for the lifetime of the next Parliament. (2)

It's interesting to note how completely different it is over here in Jersey. While the States Members have agreed a pay freeze - it is the year following a pay rise of £1,000. In the U.K., by contrast, David Cameron evidently wants to set an example with ministerial pay, and there is not just a pay freeze, but a pay cut. He has taken the moral high ground, where the States of Jersey have so clearly not done so.

If public sector workers complain about the pay freeze, David Cameron can point to a pay cut for Ministers, as a demonstration not just that "we are all in this together", but that they have gone an extra mile themselves. By contrast, in Jersey, all kinds of special pleading over when pay years start was trotted out to excuse the increase in States pay at the same time as the pay freeze for the public sector. It looked like the worst of fudges, the kind of verbal dexterity that would not have been out of place in "Yes Minister"

Items 1-3 bring the claim down to about 18% for the top grades. Therefore it should be calculated from 1973, which was the high point in percentage increases [not in income]. And take the calculation to the end of two years from now, i.e. the end of this claim period rather than the beginning. These four measures bring the percentage increase down to about 6%. (Sir Humphrey Appleby, The Complete Yes Prime Minister)

(To be fair, a few States members have publically or privately donated that increase to charity this year)

The other significant wording to note is with the public sector pay freeze - note that this will apply to everyone "everyone apart from the million lowest paid workers". Now obviously the number of lowest paid workers in Jersey would be a considerably smaller number, but the States pay freeze applied to all workers, so that more of the lowest paid would probably have to apply to income support as they descended into the poverty threshold.

Why is it that a Conservative Government can get this so right, and Jersey cannot?


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