The Rt. Hon. Sir John Major KG CH

Prime Minister of Great Britain and Northern Ireland 1990-1997

1995Prime Minister (1990-1997)

PMQT Written Answers – 9 February 1995

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Below is the text of the written answers relating to Prime Minister’s Question Time from 9th February 1995.

PRIME MINISTER:

 

Consultants

Mr. Malcolm Bruce: To ask the Prime Minister what are his latest estimates of the expenditure on all external consultants, including management consultants, for each year since 1987, in 1994 prices, for his Department; and what are the quantified annual cost savings which such expenditure has resulted in.

The Prime Minister: There has been no expenditure by my Office on external consultants, including management consultants, since 1987.

 

Engagements

Mr. Harry Greenway: To ask the Prime Minister if he will list his official engagements for Thursday 9 February.

Sir Peter Tapsell: To ask the Prime Minister if he will list his official engagements for Thursday 9 February.

The Prime Minister: This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in this House, I shall be having further meetings later today.

 

Permanent Secretaries

Sir Anthony Durant: To ask the Prime Minister if he will make a statement on the pay of permanent secretaries.

The Prime Minister: The Government announced in Cm. 2748 presented to Parliament on 26 January that they intended to introduce new arrangements for the pay of Permanent Secretaries from 1 April, and that they would make a further announcement in conjunction with its response to the report of the senior salaries review body. The Government have now considered the recommendations of the review body.

As foreshadowed in the Command Paper, a remuneration committee will be established to advise Ministers on where individual permanent secretaries should be placed within the pay range. The full terms of reference are given.

The final decisions on the pay of individual permanent secretaries will be for the Government, who expect normally to accept the recommendations of the committee.

There will be five members of the committee–three members of the review body, the head of the civil service and the head of the Treasury. The chairman of the review body will normally chair the committee.

The three external members will, sitting alone, make recommendations to the Government on the salaries of the Heads of the civil service, the Treasury and the diplomatic service.

Sir Michael Perry, who will succeed Lord Nickson as chairman of the review body in April, has agreed to chair the committee. Mr. Gordon Hourston and Ms Yve Newbold, both members of the review body, have agreed to serve on it. I am grateful to all of them for undertaking this important additional task.

The review body proposed a pay range of £90,000-£150,000. The Government accept this recommendation. The salaries of individual posts will be published in £5,000 bands once each year in the following annual report of the review body. Parallel arrangements will be made for the most senior ambassadors.

Terms of Reference of the Remuneration Committee

Membership

  1. There shall be a committee on the pay of Permanent Secretaries of whom the members will be:

3 members of the Senior Salaries Review Body (SSRB); the Heads of the Home Civil Service and Treasury.

  1. The chairman of the committee will be one of the members, normally the Chairman, of the SSRB.

Remit: Permanent Secretaries other than the Heads of the Home Civil Service, the Diplomatic Service and the Treasury

  1. The purpose of the committee is for the three SSRB members to make proposals to Ministers on the pay of individual Permanent Secretaries save insofar as their pay is determined by the terms of an individual appointment.
  2. The pay of Permanent Secretaries will be accommodated within the pay range to be determined from time to time by the Government. The committee may not propose other forms of remuneration or benefit than pay falling within this range.
  3. In making proposals the committee shall take the following factors into account in relation to individuals:

the relative level of responsibility of the post occupied; the performance of the Department in executing the policy of Ministers and the personal contribution the individual has made in terms of policy advice and efficient management, including where appropriate meeting the measured objectives of the Department; the experience of the individual in the present post or in others occupied at Permanent Secretary/Head of Department Level;

in the case of those newly promoted, the level of pay in their previous post;

any views which the Minister, to whom the Permanent Secretary is principally responsible, may wish to offer to the committee; the individual’s own assessment of his/her achievements and the main requirements of the job.

  1. The committee should also take into account these wider factors:

the pay levels of other staff in the Senior Civil Service, and in particular those immediately below Permanent Secretary;

the increases recently given to, or likely to be given, in the period ahead, to civil servants generally, and the pay progression available to them;

the extent of the change for any individual as well as the absolute level of pay, and the presentation of both;

any movement in the pay range as a whole;

the nature and terms of the Civil Service pension scheme; any statements made by the Government on public sector pay; the maintenance of the confidence of the individual, that recommendations have been properly and fairly determined;

the need to ensure recommendations are consistent with the Government’s equal opportunities policy.

Remit : Pay of Civil Service members of the Remuneration Committee and Head of the Diplomatic Service

  1. The SSRB members of the committee will, sitting alone, make proposals to Ministers on the pay of the Heads of the Home Civil Service, of the Diplomatic Service and of the Treasury. For this purpose they will take account of all the factors noted in paragraphs 4 6 above as relevant to the pay of Permanent Secretaries.

 

Review Bodies

Sir Michael Neubert: To ask the Prime Minister if he will make a statement on the review body reports.

The Prime Minister: The 1995 reports of the review bodies on the pay of schoolteachers, senior civil servants, the senior military, the judiciary, the armed forces, doctors and dentists, nursing staff, midwives, health visitors and the professions allied to medicine have now been published. Copies are available in the Vote Office and the Library of the House. The Government are grateful to the members of the review bodies for the time and care which they have put into the preparation of the reports.

The Government’s policy is that increases in pay must be fully met from existing budgets. Pay increases for public sector staff therefore have to be paid for by greater efficiency or by other economies. This position was reaffirmed in the Chancellor of the Exchequer’s statement on public sector pay on 14 September 1994, and in the Government’s evidence to the review bodies. It is fundamental to the Government’s response to their recommendations.

The review bodies have made the following recommendations: The Armed Forces Pay Review Body has recommended a range of increases in daily rates of between 2.5 and 2.9 per cent., averaging 2.6 per cent. for the various ranks in its remit group.

The Review Body for Nursing Staff, Midwives, Health Visitors and Professions Allied to Medicine has recommended a 1.0 per cent. increase in national salary rates to be supplemented by local negotiations on pay and, where appropriate, leads and allowances and/or conditions. The Review Body has said it expects that, in the majority of cases, the outcome of local negotiations would provide improvements for the staff concerned totalling between 1.5 and 3 per cent., including 1 per cent. increase in national rates.

The Doctors and Dentists Review Body has recommended pay increases of 2.5 per cent. generally for members of its remit group, and 3 per cent. in the intended average net remuneration of general medical practitioners. It has recommended that Trusts able to conclude local agreements with the profession should proceed accordingly. It also recommends an alternative system of transititional local pay for hospital consultants accepting a divergence from the nationally determined scale subject to a maximum increase of 5 per cent. in consultants’ average salary in each Trust.

The School Teachers’ Review Body has recommended a 2.7 per cent. increase in teachers’ pay.

The Senior Salaries Review Body has recommended:

(i) an increase of 2.5 per cent. in the budget for performance related pay for civil servants in Grades 2 and 3 and increases in the relevant pay ranges.

(ii) a new pay range for Permanent Secretaries to replace the existing system of spot rates with pay decisions to be made on the basis of advice from a new remuneration committee.

(iii) a range of increases between 2.5 and 3.8 per cent., averaging 3.2 per cent., in the pay of senior armed forces officers. (iv) a 2.5 per cent. increase in the pay of the judiciary. The Government have taken their decisions on these recommendations on the basis of our approach to public sector pay. We accept the recommendations and propose to implement them from the due date of 1 April. The costs will be met from the public expenditure totals published at Budget time. There will be no new money to finance these pay increases, and for the third year running there will be no call on the reserve.

The Government in particular welcome and support the recommendations of the Review Body for Nursing Staff, Midwives, Health Visitors and Professions Allied to Medicine for the development of local pay determination for members of its remit groups. Negotiations with the staff sides at national level need to be concluded quickly to facilitate additional local payments. The Doctors’ and Dentists’ Review Body has reaffirmed its support for moves towards local pay determination and negotiations are being held with the professions on changes to the distinction awards scheme for consultants which should lead to much greater local involvement. The review body had advocated brisk progress and both sides expect these negotiations to be concluded in the next few months.

I am making a separate announcement on the arrangements for determining the pay of individual permanent secretaries.

Summary of Main Pay Recommendations

|Main pay

|increases |Paybill cost <1>

|per cent. |£ million |Per cent.

————————————————————————————————

DDRB (Doctors and Dentists) |<2>2.5-3.0 |144 |2.9

NPRB (Nurses and Allied Professions)

Nurses and Midwives |1.5-<3>3.0 |117-234 |1.5-3.0

PAMs |1.5-<3>3.0 |15-31 |1.5-3.0

All NAPRB groups |1.5-<3>3.0 |132-265 |1.5-3.0

SSRB (Senior Civil Service, Military and Judiciary)

CS Grades 2-3 |<4>- |1.2 |2.5

Senior Military |2.5-3.8 |0.4 |3.2

Judiciary |2.5 |3.9 |2.8

All SSRB groups |5.5 |2.7

AFPRB (Armed Forces |2.5-2.9 |140 |2.6

STRB (School Teachers) |2.7 |294 |2.7

Notes:

(1) Pay bill costings include employers’ national insurance and superannuation payments.

(2) Plus up to 2.5 per cent. on average salaries for consultants under transitional local pay arrangements

(3) Comprising 1 per cent. on national pay scales and the NPRB estimate of additional amounts likely to result from local pay negotiations.

(4) No across-the board increases 2.5 per cent. to be paid through the performance pay budget.

(5) Increase on daily rates.