Author of IER report doubts the independence of the Pay Review Body process under new government

Dr Andrew Moretta, an Institute of Employment Rights (IER) expert and author of a recent trade union-backed report on the operation of Pay Review Bodies (PRBs), has questioned the new Labour government’s commitment to reforming the PRB process, as outlined in their 2024 manifesto.

The government sparked controversy earlier this week by recommending a 2.8% pay rise for public sector workers, including teachers, NHS workers, and civil servants in 2025/26, only slightly above the Office for Budget Responsibility’s inflation forecast of 2.6% for the period.

In its evidence to public sector pay review bodies, the Treasury said that budgets for 2025/26 have now been fixed, and “unlike in recent years, departments will not be given additional funding for pay awards”.

Unions have expressed dismay at the government’s announcement, which has also called into question the independence of the PRB process.

Dr Andrew Moretta commented this morning on the controversy, backing unions’ concern and expressing disappointment that the new goverment will “continue to regard PRB recommendations as mere ‘advice’ to the Cabinet”, despite election promises of independence:

“In the opening paragraph of the government’s December 2024 Economic Evidence to the PRBs it is stated that:

‘The government is committed to the independent Pay Review Body (PRB) process as the means for setting pay for frontline public sector workers and is acting to restore confidence in this process.’

The reality is that the UK PRB regime is on the verge of being terminally undermined. There is little evidence of any commitment to implementing an effective PRB process. The UK’s Iabour treaty obligations dictate that PRB mechanisms be deployed only to compensate public servants unable to bargain effectively with the Government through a trade union.

A PRB should be truly independent and impartial, its recommendations treated effectively as awards to be implemented in all but the most extreme economic circumstances. That is their role in a healthy democracy – that is how they should work. However, in recent decades PRBs have had their independence compromised and their coverage extended, supplanting rather than complementing collective bargaining mechanisms.

As tools of austerity, rather than serving the workers whose terms and conditions of employment were at issue, the PRB regime served the Tory anti trade union agenda by augmenting the damage caused by the laws against strikes to further reduce collective agreement coverage and permit the imposition of very considerable reductions in real terms pay.

The very disappointing news that the new government will continue to regard PRB recommendations as mere ‘advice’ to the Cabinet and the effective imposition of a 2.8% cap on such recommendations tells us that the Labour government is set to make the same mistakes as its Tory predecessors.

Rather than restoring confidence by instituting root and branch reform of the PRBs serving sectors genuinely unable to bargain collectively and by providing negotiating machinery to enable those public servants both able and willing to engage in effective collective bargaining to do so, the Government is continuing to use the PRB regime as a tool to impose real terms public spending cuts. The result will be further wholly unnecessary strikes.

Reeves and Starmer should heed the advice they offered to the hapless Sunak administration during the rash of public sector strikes during 2022-23, and ‘sit down and negotiate’ with the public sector unions with a view to restoring the real terms pay losses of the last 14 years.”

You can read Dr Moretta’s report on ‘Pay Review Bodies: their past and their future’ here.