PCS National Executive Committee met on 29th May – the first meeting since the Left Coalition won a majority in this year’s National Elections. At that meeting, it was agreed to reject the pay remit published on the 21st of May, restate our demands and approach the Cabinet Office for further talks. It also agreed, in line with conference policy (see motion here) carried only the week before, to launch a serious national campaign – a Cost-of-Living Campaign – on pay, jobs and conditions and to prepare for a strike ballot in the autumn if no progress is made in talks.
A motion tabled by the Left Coalition and moved by Deputy President, Dave Semple (see motion here) was carried overwhelmingly. This motion set out the steps required to now build the necessary campaign across the union to win.
Conference instructs NEC to fight on Pay, Jobs and Conditions
Our demands as set out in Conference motion A375 are clear:
- Consolidated pay rises of at least 10%, for £18ph minimum wage, for a minimum London pay element of £5,000, and for pay & pension restoration …..
- Return to national pay bargaining ……restoring automatic pay progression and shortening pay scales.
- 35 days annual leave as a minimum and a 28-hour week without loss of pay
- A job security agreement that protects jobs, workloads, services, offices, genuine hybrid and home working, and which regulates the introduction of AI into the civil service and related bodies…
Pay Remit Announced
The Cabinet Office published the UK civil service pay remit for 2026/27 on the last day of our conference. This cap for the overall increase to spending on pay by each civil service department, executive agency or other body is 3.5%. This is not fully funded; up to a 2% increase is new money, the remainder will be made up via cuts to jobs and other “savings”.
The remit announcement also provides for some “flexibility” for increases to tackle specific issues which could mean increases above 3.5% for some, but the cost will need to be met from within existing funds ie. there’s no new money and most likely will result in more job cuts. And there are strings attached. This is simply not acceptable.
3.5% is not enough to address longstanding issues of low pay, or the impact of pay freezes and pay caps over years let alone the impact of the cost -of -living crisis – which is set to worsen. RPI is running at 3% but even using the government’s Consumer Price Index (CPI) measure of inflation, which does not include housing and routinely underestimates real inflation, prices are set to rise by at least 3.5% by the end of 2026.
Pay “flexibility” in 2026/27: Myth Versus Reality
The remit allows for “pay flexibility” through a business case, for the following:
- Recruitment and retention
- Transfer of funds from the non-consolidated pot to consolidated pay
- Transformation
- Pay Compression Framework
- Targeted Workforce Flexibility
- The Pay Framework for Government Digital & Data, and for Cyber Staff
- Pay Settlement Date Adjustments
Unfortunately, this has been “welcomed” by the General Secretary in her unagreed statement published on the PCS website and in an email to all members on the 21st of May. She said:
“Additional flexibilities will allow departments to create grading differentials of 5% from AA to AO, and 5% from AO to EO, thereby helping to eradicate the pay compression that has resulted from pay at those grades not keeping pace with rises in the National Living Wage. Importantly, those additional flexibilities will be funded outside of the headline figure in the remit guidance”
“Departments will be able to provide improved career advancement for AA staff to enable them to reach the AO grade, recognising that numbers of AA staff are likely to reduce over time due to technological advancements, thereby getting ahead of that issue, and holding out the possibility of a further pay advancement of up to 5% for AA staff”
“Funding for restoring grading differentials outside of the headline figure will result in departments having greater flexibility on how they use that headline figure”
But this is what she doesn’t say.
Lowest paid grades consigned to the minimum wage
The Tories set the main rate of the minimum wage at 2/3rds of the average wage, an approach retained by Starmer’s government, meaning the minimum wage has risen by more than the civil service pay remit figure for successive years.
Therefore, the minimum wage has caught up with and overtaken the AA and AO pay ranges/spot rates. And is now starting to catch up with EO pay ranges, resulting in little or no pay differential between our lower paid grades. This is being described as “pay compression”. This is causing huge discontent at these levels – after all why would anyone want to do extra work with no or very little extra pay. And at the minimum wage or thereabouts too.
The “offer”
The Pay Compression Framework, designed to deal with this, means that the AA grade will be consigned to be on the minimum wage forever, any additional money will be non-consolidated and therefore non pensionable. Yes, it means that there will be a pay differential between AA and AO. But since when has it been acceptable for any of our members to be on no more than the minimum wage.
AO’s will be paid exactly 5% above minimum wage – £29,258 based on pay being calculated on a 42-hour week. Although the framework doesn’t explicitly say that any additional monies will be non-consolidated, it is implicit if the 5% differential is to be maintained between AO and EO. Meaning EO pay will be £30,721.
But, what about any London differential, it’s not funded (meaning potentially more job cuts) and the Cabinet Office want employers to calculate pay on a 37-hour week which brings down the AA rate to only xxx and in turn will bring down the starting pay of both AO and EO. And potentially knock on to other grades too.
Consigning AAs to the minimum wage does not deal with low pay and neither does it solve the problems of thousands of members who are struggling day in day out with an ever-worsening cost of living crisis. As bad, is that the General Secretary has conceded that the AA is a “minimum wage” role and is the starting point for calculating pay at other grades. This is wrong and we must fight for more.
Furthermore, she is championing AA supposed “career development” – but we know what this really means is the abolition of the AA grade. In areas where this has happened, it has been a disaster – the grade might have gone but the work hasn’t, and PCS must fight for proper grading with decent pay and conditions.
National pay bargaining has been a PCS demand for many years. But far from being this and to provide the opportunity for all pay to be harmonised to the best rates, the pay compression framework seems designed to ensure the permanency of low pay by tying the lowest grade to the national living wage!
No more for higher paid grades
Nor does the pay remit contain much of benefit for higher grades. In HMRC, 50% of staff are grade HO (HEO-equivalent) and above. In some smaller departments, the largest numbers are concentrated, at SEO or Grade 7. These workers have loyally stuck with the union despite below inflation pay rises and no PCS campaign to remedy that. No great new dawn is proposed for them – the 3.5% remit will apply.
National Executive launches Cost of Living Campaign
Despite the woeful 3.5% remit, the General Secretary proposed that we move immediately to delegated pay talks to “maximise” money i.e. employer by employer pay talks, essentially foregoing any national campaign. What a nonsense – 3.5% increase to pay bill is exactly to that and does not mean that everyone will get a 10% pay rise nor introduce an £18 an hour minimum wage no matter how you square the maths.
The NEC said no to this suggestion. A short pause to delegated talks has been agreed whilst we make it clear that we reject the pay remit and further representations are made to the Cabinet Office – a task which has been made harder by Fran Heathcote’s message which indicated that it was not only acceptable but actually “quite good”.
A new national negotiating team has been agreed, including the union’s newly elected President, Deputy President, together with the General Secretary and the Assistant General Secretary. Training and information for delegated negotiators and for activists more generally is in preparation and the first steps towards accomplishing the demand of three successive PCS annual delegate conferences have been taken: build a serious national campaign.
Co-ordinate with other unions
On 28 May, Unison, Unite and GMB unions rejected a 3.3% pay increase for local government workers. Unison has already announced that it intends to ballot, beginning in June.
The NEU is opposing a 6.5% deal over three years and has announced an autumn strike ballot. We need to demand more from the Cabinet Office and we need to prepare for a serious national campaign on pay and the other issues agreed by conference. Co-ordinating with other unions moving into dispute will help us build the pressure and as such the NEC has now agreed to approach other unions for joint campaigning and action.
Left Coalition will build the Fight
This NEC takes its leadership role seriously. Its demand for a serious national campaign on pay, on jobs, on conditions of work – from hybrid to shorter working weeks to sick pay, on the government’s location strategy and on pensions is an attempt to deliver what the leading layer of members are demanding – a way to rally against endless surrender. Join us in this fight and get active in the BLN.
PCS Broad Left Network 