During 2022, pay rises were set at an average of around five per cent, prompting threats of industrial action across the public sector, yet the projected pay rise for next year is set. We also use cookies set by other sites to help us deliver content from their services. Evidence-based: proposals should demonstrate low levels of pay that are below relevant comparators and how this has translated into significant recruitment and retention problems (including relevant statistics) and robust evidence that the pay discrepancy will have a front line impact on business delivery, outcomes, and productivity. A robust and thorough approach will be taken to assessing cases for pay flexibility higher than 3% in 2022/23, particularly cases that seek flexibility for multiple years, for example, to deliver transformational reform. Progression pay cost is the cost of moving someone through the pay range and in spine point or step based system relates to the costs of incremental steps. The assessment of a business case will take into account the individual circumstances of the department. The 4.2% difference between pay growth in the public and private sectors is just below the 4.4% gap seen between July and September. spending on health shows a nominal and real terms decrease in 2021-22 (1.1 per cent in nominal terms and 0.3 per cent in real terms). What claims do you want BBC Reality Check to investigate? Average earnings per head (FTE) is direct wages and salaries divided by FTE workforce. Such proposals will be considered where there is a clear case that reforms will generate transformation in departmental and public service delivery, and must be entirely offset by real and cashable savings, and a demonstration of tangible productivity and efficiency gains. Doctors warn of industrial action amid pay squeeze, Greek trains halted as anger over crash grows, Bitter divisions over Ukraine dominate G20 talks, Vietnam picks new president in power shuffle, How 10% of Nigerian registered voters delivered victory, Sake brewers toast big rise in global sales, The Indian-American CEO who wants to be US president, Blackpink lead top stars back on the road in Asia, Exploring the rigging claims in Nigeria's elections, 'Wales is in England' gaffe sparks TikToker's trip. the date upon which the pay remit year commences, vary from one body to another. The Treasurys sums dont add up, says the Institute of Fiscal Studies. Canary Wharf In fact, earnings growth in the year to October was 4.9%, matching consumer price index inflation, in part buoyed up by labour market shortages. As a matter of course, departments are encouraged to work constructively with recognised trade unions on the development of their overall pay, reward and workforce strategies, including annual pay remits and the development of pay flexibility business cases. Read about our approach to external linking. Ministers have said they will fund a pay rise of 3% for public sector workers and give nurses an average of 4% in line with a pay review bodys recommendations. Non-consolidated payments other than those related to performance must be included in the IRC calculation. the largest real terms percentage decrease in spending was in economic affairs (50.0 per cent), mainly due to lower expenditure on covid-19 related measures. Proposals should also deliver sustainable savings going forward and clearly demonstrate associated efficiencies and reforms. Note that this may differ from outturn or forecast expenditure on non-consolidated pay recorded as a component of salaries and wages. He must make good on this latest pledge to drive up pay for those who kept this country on its feet throughout the pandemic.". HM Treasury will provide guidance in due course with regards to Senior Civil Service or Senior Civil Service equivalent grades. The average regular pay growth for the UK private sector was 6.9% in August to October 2022, and only 2.7% for the public sector, according to the Office for National Statistics ( ONS ). There were an estimated 5.77 million employees in the public sector in September 2022, 73,000 (1.3%). Cabinet Office and HM Treasury will consider requests from departments for pay flexibility proposals where it meets the requirements set out in section 3. For example, through changes to terms and conditions of employment, and other areas such as recyclables. The government has announced pay rises for millions of public sector workers as inflation eats into salaries. Real pay for all workers also lags behind inflation, piling on pressure amid cost of living crisis. The RMT has called for a minimum of 7%, while some healthcare unions have suggested they would accept a similar amount. These are the aggregates used by the government to plan and control expenditure. It could be as low as 13bn if the governments fresh concessions for teachers and other groups are factored in as already paid for. Budget POLL: Should Rishi Sunak increase taxes in his Budget? The cost of such changes should be calculated and included in the IRC calculation. Public sector pay growth has lagged that of the private sector, averaging just 1.5% over the past year compared with 8% for the latter. Over one million NHS staff - including nurses, paramedics and midwives - to get a pay rise of at least 1,400 with lowest earners to receive up to 9.3%. Departments should also consider delivery of Spending Review priorities when considering a business case. We welcome any feedback at Evidence-based: proposals should demonstrate robust evidence in the form of data to back up the proposals. In 2022/23, because of staff reductions, the consolidated baseline paybill is reduced to 19 million. Types of payment include: The organisations existing non-consolidated performance pot is a cash value derived from a percentage of the consolidated baseline paybill, and not a fixed cash amount. The difference is increasing. It is expected pay rises will be around 5% for many staff. The BBC is not responsible for the content of external sites. For example, showing low levels of pay that are below relevant comparators, and how this has translated into significant recruitment and retention problems (including relevant statistics). Tax, Salary and Payroll in the UK; UK Average Salaries in 2023; Public Sector Salaries 2023; Salary . Departments are asked to submit these data using the Workforce and Pay Remit (WPR) application in OSCAR for each remit as soon as they are approved, but in any case by 30th September 2022 (if necessary on a provisional basis in the first instance). Not according to the Institute for Fiscal Studies, which says the Treasurys sums dont add up. As stated in section 2, the IRC includes all increases arising from the remit proposals, apart from employer National Insurance Contributions and pension contributions, and is net of any offsetting reductions in the costs. Well send you a link to a feedback form. "And now, with the economy firmly back on track, it's right that nurses, teachers and all the other public sector workers who played their part during the pandemic see their wages rise.". Well send you a link to a feedback form. The figures do not include distortions caused by the. Chief Secretary to the Treasury, John Glen, made a written statement to the House of Commons on public service pensions increase. In October 2021, the Chancellor of the Exchequer announced as part of the Spending Review 2021 that the public sector would return to normal pay setting process, with effect from the. To help us improve GOV.UK, wed like to know more about your visit today. News stories, speeches, letters and notices, Reports, analysis and official statistics, Data, Freedom of Information releases and corporate reports. One cabinet minister said the. The government has already agreed to finance a 3% rise, so the extra cost is only 18bn, he says. The next HM Treasury PSS National Statistics release will be published in May 2023. Nurses leaders have said they are prepared to negotiate over the final settlement, but say health ministers have failed to consider the offer. 2023 BBC. GDP Deflator: Financial years 2017-18 to 2021-22 taken from ONS series L8GG in Table N. Dont include personal or financial information like your National Insurance number or credit card details. Example: In 2020-21, an organisation has a consolidated paybill of 20 million and has built up a non-consolidated performance pot of 3%. Any action that risks embedding high prices into our economy will only prolong the pain for everyone, and stunt any prospect of long-term economic growth., UK train strikes start as ONS data show real wages falling by 2.7% live, Original reporting and incisive analysis, direct from the Guardian every morning. News stories, speeches, letters and notices, Reports, analysis and official statistics, Data, Freedom of Information releases and corporate reports. Vacant posts do not generate recyclable savings, because until the post is filled the salary cost to the paybill cannot be determined. Table 8 shows in detail how the budgeting data is used to construct the Total Managed Expenditure (TME) figures published by the Office for National Statistics. Departments and NDPBs are permitted to reduce their non-consolidated performance related pay (PRP) pot permanently as a percentage of consolidated paybill to offset agreed increases in paybill costs applied to meet targeted recruitment or retention pressures and to address pay anomalies. Budgets are divided into Departmental Expenditure Limits (DEL), which are firm plans for three or four years, and Annually Managed Expenditure (AME), covering spending which is demand-led, less predictable and more difficult to control. Departments, in exceptional cases, can seek targeted pay flexibility to address specific problems associated with recruitment and retention in specific grades and/or professions within their department. That's because private sector workers are much more likely to receive bonuses than public sector workers and bonuses have been relatively high this year, particularly in finance and business services. Big pay rises could push prices up, says minister. These include increases in annual leave entitlements, reduction in working hours, etc. This framework provides information on central government departmental budgets, which are the aggregates used by the government to plan and control expenditure. The proposed 3.5% pay increase covers workers including police officers, teachers, judges, nurses, doctors and dentists, many of whom have voted to strike recently over the award they received in the current pay round. It raises the prospect of a wave of strikes later this year, with several unions already threatening industrial action if salaries fall behind. The finance and business services sector and construction sector. The government is due to unveil this year's pay deal for 2.5 million public sector workers. Progression pay systems are those under which pay to individuals in a specific grade or post increases periodically. This publication is available at https://www.gov.uk/government/statistics/public-spending-statistics-release-february-2023/public-spending-statistics-february-2023, This release presents updated Public Spending data for the years 2017-18 to 2021-22. The pay of the SCS is covered by the Senior Salaries Review Bodys (SSRB) remit and is set centrally by the Cabinet Office. This is due to higher levels of expenditure in health for 2020-21, which was largely related to covid-19 measures. Number of employees on the NLW: The number of eligible employees that are on (or are within 5 pence of) the NLW from April in the pay remit year. Throughout the guidance the term department(s) includes all organisations (ministerial and non-ministerial departments, agencies and NDPBs) that come within its scope, unless the context clearly implies otherwise. HM Treasury has overall responsibility for the Governments public sector pay and pensions policy, and maintaining control over public spending including with regards to departmental spending. Exceptionally, aggregate data may be entered for NDPBs with prior HM Treasury agreement. The permitted reduction in the PRP pot is capped at an amount equivalent to 50% of the pot, or 0.5% of the baseline paybill if smaller, in order to ensure that departments maintain sufficient resources to continue to fund non-consolidated performance arrangements. Before taking account of inflation, average. Secretaries of State should consider the proposals against the following criteria: Departments need to demonstrate that their proposed pay remit is affordable within departmental budgets and through savings generated as a result of further flexibility in line with the guidance at section 3. The number of vacancies also fell in the three months to October, showing that employers are becoming more circumspect about filling jobs while the economic outlook remains uncertain. A glossary of terms used in the guidance can be found in section 7. Departments cannot reduce the IRC by deferring the date of implementation of component increases. In October 2021, the Chancellor of the Exchequer announced as part of the Spending Review 2021 that the public sector would return to normal pay setting process, with effect from the 2022/23 remit year. Baseline remuneration cost does not include employer national insurance and pension contributions. Requests to increase the size of the non-consolidated PRP pot, permanently or temporarily, will not be considered. In the accompanying excel tables, tables 10, 10a and 10b show public sector expenditure on services broken down by function over a longer number of years, allowing long-term trends to be identified. Of course, the attractiveness of a job is not just about the amount you are paid. She urged Rishi Sunak to negotiate with public sector unions to head off strike action. We are awaiting confirmation but this should be an increase of 10.1% based on the Consumer Prices Index (CPI) annual increase in September of last year. Real terms figures are the nominal figures adjusted to 2021-22 price levels using GDP deflators from the Office for National Statistics (released 22 December 2022). The business case should cover, where relevant: Departments should also work constructively with trade unions on the development of their overall pay and reward strategies and may find it helpful to discuss proposals with trade unions as these are developed. The Treasury said that freezing pay in 2020-21 had helped "to ensure fairness between the private and public sector". So how much would it cost to give public sector workers a pay rise? If agreed, that would mean an increase of 9.42 per cent this year and 22 per cent over the two years since April 2021 for the lowest paid, with a 2023 uplift of 3.88 per cent for top earners. Average earnings per head (headcount) is direct wages and salaries divided by headcount. The industry leader for online information for tax, accounting and finance professionals. Paybill costs of those on the NLW: The total paybill costs incurred by all employees on the NLW within the pay remit year and the cost of increasing the wages of eligible employees to meet the legal entitlement of paying the NLW. The deadline to submit a case for the 2022/23 remit year is no later than 1 December 2022. Increases in remuneration made specifically to fulfil the legal obligation to include payments for regularly worked overtime in statutory holiday calculations should be considered outside of the headline pay awards, providing that the increases are made only to the extent that they fulfil the legal requirements. Ben Zaranko, an economist for the thinktank, says that even using Sunaks methodology, the figures are wrong. Excludes those employees moving between jobs within the department. Home of the Daily and Sunday Express. UK's Taylor Wimpey cuts jobs amid housing slowdown, National Express says more Britons shift to buses after rail strikes, Reporting by David Milliken; Editing by Leslie Adler and Marguerita Choy, Britain's Nationwide curbs cryptocurrency purchases by customers, LSE Group targets Blackstone/Thomson Reuters stake buyback as raises outlook, Sterling falls as interest rate outlook and strong dollar weigh, Biden admin offers $1.2 billion for distressed, shut nuclear plants, Russia says West is 'burying' Black Sea grain deal, Blinken, Lavrov spoke briefly on margins of G20 meeting - U.S. official, Factbox: What to look for as China kicks off its annual session of parliament, Exclusive news, data and analytics for financial market professionals. Before taking account of inflation, average total pay growth for March to May 2022 was 7.2% in the private sector and 1.5 in the public sector. 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