Regional public sector pay will benefit NW business, says IoD chief

THE director general of the Institute of Directors has said the introduction of public sector regional pay scales will benefit both the private sector in the North West and the region’s economy as a whole.

The government announced in Wednesday’s Budget that it has asked independent pay review bodies to look at whether to make public sector pay more responsive to local pay rates – something the last government introduced into the Court Service.

Simon Walker, who was speaking at the IoD’s annual conference in Manchester yesterday, told TheBusinessDesk.com that national public sector pay scales mean the best talent goes to the public sector, where pay is generally higher.

He said: “The problem we have got is that public sector pay in the regions is crowding out private sector employment. Our members say that.

“It’s a real problem and disincentive to base business there [in the regions] – national pay scales are a disincentive.”

Mr Walker said he felt the government is “genuinely concerned” about the regions.

He added that the introduction of regional pay scales would allow the private sector to compete for the best talent and would create an incentive for businesses to set up and create jobs in the region.

He said: “Our members – particularly in the North East – say they can’t get good financial services managers and mid level clerical workers, for example, because those people can go and work in the public sector on a much higher income.

“It will generate jobs and it will bring jobs where there are no jobs.”