Ministers are said to be pursuing regional pay for civil servants. They would be unwise to do so.

By Matthew Barrett
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Conservative Ministers are still pushing for regional pay for civil servants, according to a report in the Sunday Times (£).

The newspaper reports that civil servants' pay outside London is said to be "hampering recovery in the private sector", because an internal Cabinet Office report said many junior civil servants earn as much as or more than private sector workers in equivalent positions.

In his Autumn Statement, George Osborne said he would not introduce "centrally imposed changes" to civil service pay, but Tory Ministers are said to wish to bypass this by introducing regional pay to individual departments. 

However, the big obstacle for Conservative Ministers is that Nick Clegg and his party are thoroughly opposed to regional pay. The reasons why are obvious: many Lib Dem MPs represent either rural or industrial areas, in many cases in the Celtic fringe, which will have income levels below London, and would therefore feel the impact of any regional pay reductions.

But Nick Clegg is not the only obstacle. Few Conservative members of the Cabinet represent seats in the north, and those who do, such as William Hague (Richmond in Yorkshire) and George Osborne (Tatton in Cheshire), could not be said to represent the toughest seats currently held by the party. However, backbench Tory MPs from areas which would be affected, such as the North East, have also strongly opposed regional pay, knowing how many votes it could cost David Cameron in 2015.

In a great many Tory-held marginal seats, a disproportionate number of voters work in the public sector. There are often too many of them for there to have been an electorally significant number who voted Conservative in 2010. So in many seats there are hundreds or thousands of public sector workers who voted Tory last time, who need to be kept onside in 2015. Many Tory MPs with slim majorities would have a hard time voting for regional pay.

This is the fundamental point: introducing regional pay, if the Sunday Times story is correct, could cost the Conservatives a majority. Regional pay will obviously reduce living standards for public sector workers in less well-off areas, a disproportionate number of whom, it should be noted, are women. Britons already feel their living standards are too low; for example, Survation found that 83% of working people think the current minimum wage isn’t enough to meet living costs.* Reducing pay for civil servants outside London will only exacerbate this feeling.

I've said in the past that I agree with the principle of regional pay. There is no particular moral justification for civil servants being paid any more than private sector workers. Indeed, encouraging more people to enter the private rather than public sector is a good thing in almost any economic situation. However, I struggle to see how George Osborne, with his strategist's hat on, can view regional pay favourably. The Conservative electoral position is surely too fragile to throw away thousands of public sector votes like that.

* The Observer has an unrelated story about the living wage being introduced for some of the lowest-paid workers in government departments.