FURTHER pay awards for public sector workers will mean compulsory redundancies are more likely, the Chief Minister has warned.
Allan Bell admitted he was frustrated with pay rises or lump sum deals were being negotiated at time of financial stringency.
And with no extra money to pay for them, the settlements can ultimately be funded only by reducing the level of funding available for public services or by making compulsory job losses.
He was speaking after it was announced that public sector manual workers - as well as others such as bus drivers whose pay is linked to Whitley Council rates, are to receive a taxable one-off £400 lump sum. It’s a move that will cost government departments an extra £600,000.
Mr Bell said: ‘There is no allocation within government budgets for this figure. It will undoubtedly mean a further £600,000 reduction in provision for public services or alternatively will lead to job losses.
‘We can’t find extra funds for any wage settlements across any area of government. Departments have no option but to look for commensurate savings. It’s very frustrating for government when we are trying to send out a very clear message that we are facing financial stringency at the moment.’
Mr Bell said the government had been trying to make savings without recourse to compulsory redundancy.
‘So far we’ve been quite successful in that. But the more of these wage settlements there are the more likely it will be that compulsory redundancies will take place.’
The Chief Minister said the settlements are often outside government’s control because disputes can go to arbitration.
And he said he ‘fully understood the frustration’ of the government workforce at a time of very low levels of wage settlements.
Alfred Cannan, chairman of employer’s side of Whitley Council and chairman of the Civil Service Commission, has already warned that pay awards will ultimately cost jobs and ‘sooner of later the day of reckoning is coming’.
The island’s civil servants - and all Tynwald members - have received a 20p per hour pay rise this year which will cost government an extra £837,000 a year.
Government staff are being consulted over plans to cut rates of redundancy pay.
Currently, a civil servant who loses their job could be eligible for a lump sum severance payment of up to three years’ pay.
Under proposals put forward by the employers’ side of a joint working group, cash compensation in cases of genuine compulsory redundancy will be limited to no more than 12 months’ pay, while in other cases such as voluntary redundancy, the absolute maximum will be 21 months’ pay.
The consultation notice says employers have sought to reassure staff that the changes will not be a ‘prelude to mass redundancies’.
