Arguing over a rise of 1.5% might be seen as dancing on the head of a pin – but that completely misses the point. The revised offer last week by the Local Government Employers of 1-1.5% is, as critics have pointed out, insensitive in a recession, and a public relations own goal. Whether or not councils have factored it into their budgets is irrelevant. The point is that it sends out the wrong signals to the public while, at the same time, having hardly any impact on employee wage levels. The original offer of 0.5% was right in the circumstances. It was also right that as the state of the economy continued to deteriorate, local government employers hinted they would withdraw even this offer if the unions rejected it and replace it with 0%. Considering many private employers are both laying off staff and freezing pay, this is not the time for councils to be offering salary rises. Arguments that they are needed so councils can retain staff or address low pay scales is spurious when unemployment in the private sector has been soaring. And this is before the public sector spending squeeze takes effect from 2011. It is hardly surprising Birmingham City Council has reacted so strongly against the rises, considering the state of manufacturing in the West Midlands and the publicity over the ailing car industry. The fact that it is Conservative-led and that the Conservatives on the national employers opposed the rise does not detract from the council's argument, that the rise is insensitive and that insufficient consultation took place beforehand. There are already heavy hints that councils might arrange their own local pay bargaining in future. Local authorities played their hand carefully over council tax rises this year, understanding residents' concern about higher bills. They have fulfilled an active role in helping combat the impact of the recession on their localities. But the revised pay offer threatens to dislocate that vital accord between themselves as community leaders and their public.
