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Local Authority Manual Workers (Pay)

Volume 961: debated on Wednesday 31 January 1979

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(by private notice) asked the Secretary of State for the Environment whether he will make a statement on the breakdown of negotiations over local authority manual workers' pay.

A meeting of the national joint council was held yesterday, and I regret that no progress was made. I shall be seeing the employers' representatives tomorrow, and I trust that negotiations will be resumed in a few days.

Does my right hon. Friend agree that it is rather amazing that apparently the employers' side did not feel able to put the Government's £3·50 offer on the negotiating table, and apparently did not agree with the comparability studies that have been suggested by the Government? Will the Government now immediately institute such studies? Does my right hon. Friend agree that negotiation is better than industrial disruption—better not only for the community but also for individual workers?

I wholly agree with the sentiment expressed by my hon. Friend about negotiation. I must confess that I was surprised about yesterday's events, because I had been led to believe that the meeting would be the start of serious negotiations, and it is well known that the Government's underpinning proposals, anounced by the Prime Minister on 16 January, are of particular relevance to the lower-paid. I believe that comparability needs to be discussed further, but by no means at undue length. I hope that the negotiations will resume shortly, and resume on serious propositions.

Will the right hon. Gentleman clarify one point in what he said? Is it not a fact that the negotiations have not broken down and that therefore the industrial action now being taken is yet another example of action before negotiations finally terminate? Secondly, is it not a fact that the union's national officer said on television last night that even if the employers had given what the Prime Minister offered, it would still have been rejected?

One always has to take account of the particular situation—whether it be a situation of negotiation, pre-negotiation, or negotiations on the point of starting—in judging what people who are party to the negotiations say about particular figures. I agree that this is not a question of the breakdown of negotiations; it is really, as it were, a beginning of negotiations which everyone is determined to see start.

Is not the key to this situation the fact that a study should be set up now by the Government to make an urgent report—say, before Easter—on the whole question of comparability? The team to do the job should be appointed by the Government, with the terms of reference to be agreed, so that the arguments about the lower-paid and comparability can be taken on board. Is it not clear from what we have said, and despite what has been said by Members on the Opposition Benches, that unless the Government move in and take the negotiating committee by the scruff of the neck we will not get anywhere?

While I understand the superficial attraction of a very quick comparability study, I do not believe that that would be the right way to proceed, although I believe that the general principle of comparability is extremely relevant. My right hon. Friend the Member for Bermondsey (Mr. Mellish) well understands that, in view of the very many different skills and occupations concerned, we need to do a serious job if comparability is to play, as I believe it should, an important part in future negotiations.

Is my right hon. Friend aware that every local authority association in the country is Tory-controlled, hence the obstruction that appeared to exist at yesterday morning's meeting? Can he explain to the House what negotiations are going on between the Prime Minister himself and the local authority associations about what the Prime Minister said last week—and, I think, said very sincerely—in this House?

I hope that the political complexion of the local authority associations—[Interruption.]—will not be a problem in getting serious negotiations going. [Interruption.] My hon. Friend may be assured—

Order. I remind the House, which I have not done for a long time, that interruptions from a sedentary position are unparliamentary and that Ministers and other Members must be allowed to put their point of view.

I want to reassure my hon. Friend the Member for Derbyshire, North-East (Mr. Swain) that the Prime Minister's statement and its relevance to the local government pay claim have been made absolutely plain to the local authority associations in, I should think, at least two meetings that I have had with them.

Will the Secretary of State say whether the Government have intimated to either the employers or the employees' side in this negotiation whether there is any limit, or any Government guidance on what should be the limit, of the employers' offer? If so, will he say what that limit is?

Following the Prime Minister's announcement on 16 January, the local authority associations are certainly aware of the Government's proposition. We have had discussions with the employers, and they were able to come forward with and to put to us a proposition that carried the underpin concept a step further forward. On the understanding that this could lead to a solution of the situation, we were prepared to assist them in terms of the rate support grant in the way that we normally do.

What happens now? Is there a date for another meeting soon? Can the right hon. Gentleman arrange it?

I have every reason to believe that the two sides, although they did not progress yesterday, are in close touch with each other, and I have no doubt that a further meeting will be arranged within the next few days.

Order. I remind the House that this is an extension of Question Time, but I will call a few more Members.

My right hon. Friend keeps referring to negotiations, but does not he agree that in any set of negotiations one has to have something to negotiate about? Therefore, if the local authority associations have refused to put an offer on the table, there have been no negotiations. Although he could not agree with my right hon. Friend the Member for Bermondsey (Mr. Mellish) that the negotiations should be taken by the scruff of the neck, could the Secretary of State at least indicate forcefully to the local authority associations that they should get on with the job of negotiating?

My hon. Friend is right—the negotiations have not begun. I shall be seeing the local authority associations tomorrow and I assure him that I will make plain my strong interest, and the interest of the whole country, in the commencement of meaningful negotiations.

Will the right hon. Gentleman make it clear on behalf of us all that the right to strike does not extend to the right to take selective industrial action without loss of pay?

It depends on the nature of the selective actions, which are of a wide-ranging kind. I cannot give a blanket response to such a general question.

Does my right hon. Friend agree that yesterday's pussy-footing around by Tories who profess to believe in free collective bargaining but then refuse to bargain can only strengthen the hand of those workers who believe that they can only gain by taking further industrial action and weaken the hand of those who believe that the only solution is through collective bargaining with their employers?

I agree that an unfortunate impression was created by the fact that, when everyone had expected negotiations to begin, they did not begin. I agree that, in the general climate of opinion at present, all have to be careful not only about the substance of what they are doing but about their tactics.

Does the Minister agree that we would all prefer successful negotiation? Negotiation presupposes equality of strength between the two sides. Within the existing legislative framework and philosophy of the Government, and their actions over recent years, there is now no incentive for those who strike to settle at all, except upon the basis of total victory to them and total defeat for the Government. That fundamental situation remains. Until it is changed there can be nothing but inflation.

Order. The hon. Gentleman is advancing an argument, not a question.

I shall call two more speakers from either side—plus one, maybe.

Surely the Secretary of State must understand that meaningful negotiations are not on if the Government retain their rigid position of saying "No more than £3·50 or 7 per cent. on average for those earning less than £70 per week". Will he assure the House that there is some flexibility in this? He knows that the Prime Minister's offer goes nowhere near reaching the £60 minimum that is demanded by the unions and therefore the unions have said before the negotiations start that that offer is not on.

Will the Secretary of State now put some money on the table and get down to the task of meaningful negotiations, and get rid of the Prime Minister's maximum?

It is the taxpayers' and ratepayers' money that is involved. We must take account of the effect of any settlement outside what we anticipated in the terms of the rate support grant on taxation and the rates.

I do not accept what my hon. Friend said about a rigid position. The Prime Minister's statement indicated a clear desire to help the lower-paid. The local authorities, basing themselves on that, came forward with a proposition that developed it further. We gave them our assurance that we could accept that proposition. I do not accept that that is a rigid position.

Will the Secretary of State discuss with his right hon. Friend the Secretary of State for Education as soon as possible the impact that this dispute is having on many schools? In parts of the country they have been open for only nine or 10 days since Christmas. That is having a serious effect upon the education of the children concerned.

I know that my right hon. Friend the Secretary of State is concerned about and aware of the difficulties in the schools to which the hon. Gentleman referred. I undertake to pass his remarks on to her. However, the House has the opportunity of questioning her on her responsibilities.

The Minister will have read the document produced by the National Union of Public Employees, which sets out clearly and unequivocally the £60 minimum case in terms of both comparability and inflation. May I remind him that the Government's offer is 8 per cent. to all the workers involved? Should not the Government set up an inquiry straight away, irrespective of what the Tory-dominated local authorities intend to do about it?

Certainly we shall consider further, without undue delay, the question of comparability studies, which do not apply only to local government workers. We are thinking of the Health Service workers and other workers. It is a wide-ranging exercise.

As to the substance of the NUPE pamphlet to which my hon. Friend referred, I am not clear to what it refers when it quotes the figure of £60. The average earnings among local government manual workers on the April 1978 survey figures from the Department of Employment were £65, or thereabouts. Clearly the document cannot refer to the earnings figures. It must refer to the basic rates. That represents a difficult problem.

Does the Secretary of State realise that it is his responsibility to give realistic guidance to the local authority associations? Will he take account of what was said by the hon. Member for Tottenham (Mr. Atkinson)? If the water workers rejected the 14 per cent. offer, and the Minister can find a large amount of money for the BBC staff and many others, is it not totally unrealistic to suggest that the figure can be only 8½ per cent.?

I do not accept that there is a close parallel between the two cases cited. There is the basis for a realistic start to negotiations.

Yesterday at Question Time the Prime Minister said:

"An offer has been made to local government workers of an increase—a substantial improvement in their low pay and a study of comparability."—[Official Report, 30 January 1979; Vol. 961, c. 1235.]
Is it not correct that yesterday afternoon the employers' side rejected a request from the trade union side for a special inquiry into the rates of pay of manual workers?

It is slightly more complicated than that. As I understand the local authorities' viewpoint, they would like a very wide-ranging comparability study. They will want to discuss that. However, I should certainly not say that they had turned down the idea of a comparability study affecting local government employees. I hope that we shall be able to straighten out and make plain those factors very soon.

Will the Secretary of State be a little more forthcoming about the meetings that he has had in these negotiations? He told the House that he met the employers. Has he or any other Minister met the employees to explain the implications of Government pay policy for the claim that is under discussion? Will he confirm that it is not the political persuasion of the local authority associations that is important in this case?

Local authority associations, of whatever political persuasion, will do their best to carry out Government pay policy within the context of the Government rate support grant. It is those two critical national policies that are in question in the whole of the negotiations now under way.

Thirdly, will the Secretary of State say something about the position of cash limits as far as these negotiations go? I believe that the cash limit in local government expenditure is the only cash limit that has been published. The Prime Minister agreed that in so far as he made an offer to the low-paid it could be varied to that amount. Will the Secretary of State confirm that the cash limits will not be varied as a consequence of any decisions about the negotiations that are still to be resolved?

Fourthly, will the Secretary of State confirm the Prime Minister's figures—which the Secretary of State apparently does not have this afternoon—showing that a settlement of 10 per cent. will lead to rate increases on average of 18 per cent., and a settlement of 15 per cent. will lead to rate increases of 27 per cent. on average?

I am not entirely convinced that quite so many detailed questions are helpful at the beginning of a negotiation. However, I shall reply as best I can.

I could see both the employers and the representatives of the unions again. We have explored together the question of the nature and kind of comparability study that offers one of the main keys to the solution of our problems, not just now but in the future.

I understand the limitations imposed by the local authority employers. Nevertheless, the approach must be designed to obtain a solution. It is necessary that the way in which people proceed should be extremely tactful in this obviously sensitive situation.

Thirdly, as to the figures put to me by the hon. Gentleman, I confirm this. It is always difficult to make assumptions behind a statement of figures on which I am asked to comment. It is broadly the case that for every 1 per cent. increase in incomes across the board in local government paid out of the rates—not just to local government manual workers—there would be an increase of about £75 million a year.

Will the Minister answer the third question about the position of cash limits, on which the Government's economic strategy depends?

It is easy and straightforward to answer that question. The cash limit follows what the Government agree in terms of what is a proper settlement. As the Prime Minister made clear in his statement on 16 January, the cash limit would be adjusted in order to take account of the low pay underpin that had been put forward.

On a point of order, Mr. Speaker. A few moments ago you said that in the interests of the business to come you would accept two more questions from each side. This is the third time that the Macebearer has been on his feet.

Order. The hon. Member for Derbyshire, North-East (Mr. Swain) knows that when I make that sort of statement I usually say "including the Front Bench". I did not do that today.

Order. The hon. Gentleman must give me a chance. I have had notice of four applications under Standing Order No. 9. I will first take the concluding question. Mr. Heseltine.

I am most grateful to you, Mr. Speaker. I shall be very brief. When he made his special concession to the lower-paid the Prime Minister announced that the cash limit would be varied to take that concession into account. Will the cash limit be varied further to reflect any other settlements in terms of this negotiation?

I have not given any impression that it will be adjusted for any other settlement. What I made clear is that the development of the Prime Minister's underpin idea in a slightly more generous way by the local authority employers had been put to us, and we confirmed that we would be able to cash-limit that as well.