Cuts Watch #311: Public sector pay freeze in Scotland
In an article in Scotland on Sunday, Finance Minister John Swinney has hinted that his draft Budget (due to be presented to the Scottish Parliament on Wednesday) will follow George Osborne’s lead by imposing a one-year public sector pay freeze on workers earning over £21,000.
Westminster cuts mean that the Scottish government has to save £1.3 bn from its £30 bn budget – which includes health and funding for Scottish local authorities. In his article, Mr Swinney calls for “an understanding that pay restraint is required,” saying that this “will enable us to save jobs”. Mr Swinney describes this as “the essence of the Scottish social contract that we seek in these difficult times.”
Mr Swinney argues that this measure will save £300 million though, as the Telegraph points out, the plan as described in the media would actually involve the pay bill rising by £120 million, because 47 per cent of public sector workers earn less than £21,000. It is worth noting, however, that although the stories all assume the £21,000 exclusion, Mr Swinney’s article does not mention it.
Unions have pointed out that the freeze will represent a significant pay cut in real terms and that the Scottish government has spent £250 million on consultants – almost as much as the freeze will save. The Scottish Conservatives and Liberal Democrats have supported the freeze proposal but the Scottish Labour finance spokesperson said:
John Swinney’s talk of a ‘social contract’ is nothing more than a smokescreen for cuts that will hit children and pensioners hardest.