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Farepak and MPs Salary

A considerable amount of fuss has been made about whether or not MPs should donate £165 (a day's salary) to those who have lost money in Farepak.

I give more to charity in a year than £165 so the question is why Farepak?

Firstly, noone has contacted me from my constituency about the issue so it does not appear to be an issue in Yardley.

Secondly, for each MP who donates someone who lost a hamper at a value of £500 will get about a fifth of a penny. Hence if 600 MPs donate funds then people will get £12 towards a hamper. Enough really for a fish and chip dinner for a family of four.

Thirdly, why Farepak and not MG Rover.

Fourthly, why Farepak and not Save the Children or Help the Aged.

As far as I am concerned I will continue to support local youth groups rather than Farepak.

The important point about Farepak is why the advance monies were not kept in a trust account so if the company goes bust the money is not lost to the depositors. That, however, is the responsibility of the government. (DTI)

If there are any people in Yardley who have suffered from this then I will be happy to look at how we can make Christmas better for them, but not by giving them 0.2p.


Stephen Booth said…
I hadn't actually heard that anything had happened with Farepak. A quick skim of the news sites just now seems to indicate business as usual for this time, board members pocket the cash and leave the customers and workers in the lurch.

I think a greater concern for Birmingham this Christmas will be the employees of Birmingham City Council who will be getting a letter telling them that their pay will be significantly cut from next April under 'Single Status'. Whilst the press (local, national and even international) has focused on a very small number of workers on very high salaries (salaries apparently that high overtime, unsocial hours allowances &c) they seem to be ignoring the much larger groups who are not high paid, certainly not over paid, but are simply not as underpaid as other groups.

When the NHS faced Agenda for Change, a similar process to Single Status, central government provided £3bn to fund pay rises and back pay for those under paid groups so the pay line could be drawn high enough that low paid groups (predominantly women workers) could be given the rises they deserved and the higher (but not highly or over) paid groups did not have large or wide spread cuts to their pay. In other local authorities between 20 and 30 percent of employees have endured significant pay cuts (from Solihull I have heard first hand accounts of 40% of the IT department walking out on the morning the new pay structure was announced because they could not afford to endure the proposed cuts) whilst those who Single Status is supposed to help have seen smaller rise than they deserved and would have received had Single Status been properly funded. Indeed, in Coventry there were significant cuts to the pay of many of the groups of, predominantly women, workers that Single Status was supposed to help. Cleaners, cooks, carers, clerical workers &c saw their pay cut, a double whammy as they had thought their pay would rise.

I find it unacceptable and immoral that this process is being forced through in Birmingham without proper funding, no consideration to the impact it will have on many of the hardworking staff or to the impact it may have on the service users of the council when large groups of essential staff find themselves faced with the choice of quitting the council for the private sector or losing their home. The NHS was given £3bn to fund Agenda for Change, do local government employees really deserve less favourable treatment?
john said…
Equal Pay and Single Status were agreed some time ago in the sense that Equal pay has been law for some time.

Single Status was agreed at the time by the Trades Unions. The government has refused to provide additional funding and council tax is limited by government as well. Hence either the net cost has to remain constant or services need to be cut. I am arguing for maintaining services.

The details for this will be important. However, no local politician could promise merely that people's salaries would increase and there would be no reductions.

All I can say is that some of the more extreme overpayments will be pulled back. What else is a mattter of detail ideally to be negotiated, but the trades unions are in a difficult situation with members suing trade unions in the north.
TonyF said…
£165 a day? How often during a day is an MP actually working? A carer, y'know, the one that gets a pat on the head every year for a week, gets £44 a week invalid care allowance for working 24/7. I don't think it would hurt to hand over £165 to people who scrimped and saved to put money towards a hamper and gifts for children. After all, they're not on £165 a day either. Why Farepak and not MG Rover? I think you'll find John that most of the people who saved with Farepak are on the poverty level and didn't lose a job where a lot of people were paid good salaries and then were given help to get back into work. By the way, I didn't save with Farepak so you wouldn't be giving your money to me.
Stephen Booth said…
Equal pay was passed into law in the early 1970s, strictly based on comparing the pay and jobs of low paid women workers with their higher paid male collegues. The process however, is that where an inequality is found the pay of the low paid women is brought up to the level of that of the men, the men's pay remains unchanged.

It's true that trade unions did originally back Single Status, as a principle, but it has since transpired that the implementation has not delivered as expected (inparticular in cases such as Coventry where low paid women actually lost pay as a result).

Services do need to be maintained, but, as I noted in my original comment, many of the people providing those services are facing paycuts that seem likely to make it non-viable for them to remain in their jobs. For example in many local government IT departments the employees with the knowledge and skills to keep the core systems running are already working for significantly less than their private sector (and other public sector) counterparts, yet the outcome of Single Status seems likely to cut their pay still further. If a significant proportion decide that they cannot continue and so leave then the councils will have to either reduce services which rely on those core systems or spend even more money on high priced contractors and consultants.

Comments in the press by certain prominant councillors relating to the recent deal between Birmingham City Council and Capita point to an aim of improving frontline services by releasing staff from back office work to the front line by automating more of the back office work. How can this work if the back office automation fails because the people needed to maintain it are not there?

It should also be obvious that if the salaries of higher (but not high or over) paid employees is cut that will reduce the potential increases for the low paid workers. They will still be low paid, just not quite as low paid as before.

There may be some people who are extremely over paid, albeit likely few in number. But that begs the question as to how they got that rate of pay? The job market in most areas is, for the most part, a buyers market, the employers set the rate of pay (the price of labour) and if they can get enough people prepared to work for that rate of pay who can do the work then there the rate of pay stays. If they can't find people capable to do the job who are prepared to work for that rate of pay then they have to increase the rate and/or change other conditions until they can find the people. The like of the old guilds system where to work in a field you had to be a member of a guild, who set a minimum rate of pay for the job, are rare (the only one that comes to mind right now is the performing arts, you may find it in some of the professions as well).

If councils find that the impact of Single Status results in a problem with recruitment and retention of staff with the required skills and knowledge then they have to resort to market supplements, payments over and above the Single Status rate of pay. This has two problems, firstly in perpetuates the inequality and secondly it has to be funded. If council tax cannot be increased and no funding can be found from outside the authority then services will have to be reduced.

Agenda for Change was backed by £3Bn from central government, why refuse to do the same for Single Status?
john said…
The fact is that Central Government won't put any money into Single Status. I am not defending the position of Central Government merely stating the factual position.

Given that this is the case what else can the council do?
Bob Piper said…
Single Status was not "signed by the trade unions" in isolation. It was a national agreement signed by both the local government employers AND the trade unions 10 YEARS AGO!

The NHS, the biggest employer in Europe, carried out Agenda for Change in not much more that 12 months. In local government the employers have had 10 years to think about it, 10 years to prepare, 10 years during which they have not even carried out a job evaluation exercise in 90% of councils, and now they want to bleat about the cost of it. Let me tell you how lucky we are that the unions have let us get away with it. If Stefan Cross and the rest of the ambulance chasing solicitors get hold of us we will pay billions upon billions in compensation to what are predominantly low paid female workers, and Cross & co. will sue the arse of councils and unions for the disgraceful delay in settling the equal pay issue for these women. The unions have let you get away with it because they don't want to bankrupt councils and threaten other members jobs. Stefan Cross won't give a stuff about that, he will go for every penny he can squeeze on behalf of those he represents.
Stephen Booth said…
As an entity 'the council' can probably not do much other than be upfront with the staff, the public and the press, and do the best they can for all the staff, low and higher paid, with what they can get.

The councillors and other political activists, on the other hand, can do a lot. Acting through thier political groups they can campaign, lobby and put pressure on the government to provide proper funding for Single Status, as they did for Agenda for Change.
john said…
Ok So as your Councillor and soon to be MP I have done that. It remains, however, that the government won't fund it.

Try asking the Labour MPs.
Stephen Booth said…
My current MP is a Labour MP, a letter is on its way.
john said…
Unison have sent a standard letter around all Birmingham MPs AFAIK.
Stephen Booth said…
I believe that some unions have provided model/template letters that members can either send to their MP and/or councillors or use as a basis for a personalised letter, rathet than the union contacting the MPs themselves. Elected representatives have no mandate to act on behalf of the unions, they do have a mandate to act on behalf of the electorate, so there would be little point in a union writing to an MP (unless they were a US style Political Action Committee and were offering a donation to 'campaign funds').
john said…
Which is much the same. I think the letters were collected by Unison and sent by them.

It is also entirely reasonable for a union to write as a union to MPs. This happens frequently and there is nothing wrong with it.

Furthermore constituents do not have a right to a response from their own MP or any other MP. On the other hand I try to ensure that my office responds to people ideally by return failing that within one or two days.

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