I met the chairman of the Audit Commission together with ministerial colleagues yesterday.
At a time of private sector pay freezes and public sector pay restraint, is it right that the leaders of our quangos are getting pay increases of up to 20 per cent. or more?
The principle that must guide the rewards that go to leaders of quangos has to be very clear: they must be rewarded only on the basis of their performance on behalf of the public. However, the hon. Gentleman is right to allude to the necessity for public service leaders, no matter what part of the public sector they work in, whether it be the BBC or any other non-departmental public body, to set an example and to show restraint. That is why we have limited pay awards for senior civil servants, judges, senior NHS managers and NDPB chief executives in this financial year to just 1½ per cent.
Does the Minister agree that there are substantial numbers of public sector workers who are low paid and do not deserve to have their pay frozen, and that although there is a need for pay restraint, it ought to be applied to those at the top of the public sector and, indeed, to those at the top of the private sector?
My hon. Friend has an excellent point. It is incumbent on the leaders of public services, at such times, to show restraint and to set an example. However, I agree that over the past 10 years it has been important to give some above-average pay increases to front-line staff in particular, such as nurses, fire service workers and the police. If we look back at the average pay rises throughout the private and public sectors, we find that they basically come out about the same. However, within that overall improvement in public sector pay, we are proud to have achieved particular rewards for nurses, teachers and police, because, let’s face it, for many years they were under-rewarded.
The Minister says that he is in favour of quango-boss pay restraint, yet we are seeing figures of 22 per cent. at the Centre for Environment, Fisheries and Aquaculture Science, 17 per cent. at the National Treatment Agency for Substance Misuse and 16 per cent. at the UK Hydrographic Office. The Chancellor told The Sunday Times that
“a pain-free way of cutting public spending would be to freeze public sector pay”.
So which is it? Is he in favour of a pay freeze or huge rises for quango bosses?
The argument is the argument that I made to the hon. Member for Broxbourne (Mr. Walker). There cannot be any automatic entitlement to bonuses or, indeed, to high pay. Any bonuses to people in the public sector can be awarded only on the basis of the performance that they have delivered for the public. Of course, on quangos there are wider questions—not just about pay, but about the number of quangos that we have in this country—and that is why I have asked for a cross-government look at the number that we have. What I will certainly not be doing, unlike the Opposition, is bringing forward plans for another 17 of them.