John Patten told the independent School Teachers' Review Body in a 36-page submission that performance-related pay was the key to raising standards, sharpening management and motivating staff. 'It is realistic and desirable to work towards arrangements whereby any increase in the pay of an individual teacher is triggered solely by his or her performance and achievements,' he said.
The review body favours rewarding successful schools with a financial bonus, but Mr Patten wants individual payments for teachers so that all have an incentive to improve performance. Merit pay should be decided by governors and not be based solely on a school's position in league tables of exam results or on truancy or staying-on rates.
Governors should have increased flexibility to award and review discretionary payments. Merit pay should come from the existing pay bill, not depend on a separately identified block of money.
Mr Patten's proposals came against a background of growing tensions over this year's public sector pay round.
Local authority pay negotiators were furious that Government threats to 'take on' public sector unions could have wrecked confidential plans to impose their own pay freeze.
Leaders of the Association of Metropolitan Authorities, representing the biggest local authority employers, were due to discuss a controversial proposal later this month to freeze salaries of those earning above pounds 15,000 in exchange for granting some increases for the lower paid.
The intention would be to keep the overall pay settlements below the rate of inflation.
One Tory minister at the party's conference in Brighton said: 'It would be quite nice to have a Nalgo strike'.
This provoked an angry reaction from Nalgo, the public service union. Alan Jinkinson, the union's general secretary, said the remark was 'a piece of political posturing'.
He did not rule out a strike, but said the union would soon be consulting its membership about a pay claim and their views would be paramount if there was to be a dispute.
Jeremy Beecham, chair of the Association of Metropolitan Authorities (AMA), said that local authorities had always taken seriously the need for prudent pay settlements. Last year workers in local authorities settled for rises of 4.1 per cent.
'Our record in the last two years cannot be criticised, indeed it is better than central government,' he said in a letter to Michael Howard, Secretary of State for the Environment.
A paper to be presented to the policy committee of the AMA later this month makes the case for a two-tier settlement at a time of restrictions on the rises in revenue support grants. 'A small increase for low-paid staff and a pay freeze for the higher-paid staff would be an appropriate response.'
Mike Grealy of the County Councils' Association said a standstill was not practical. 'We've heard all this before. You clobber the public sector, roll back the state and impose a pay freeze on civil servants and local authority staff. It won't work.'
Suggestions that nurses and teachers might be exceptions to the rule would lead to further difficulties, Mr Grealy said.
The average basic salary of Nalgo members in local government is pounds 12,400. More than 44 per cent are being paid below the European 'decency threshold' of pounds 207 a week, according to the union. The overwhelming majority of low-paid public sector workers are women.
Rodney Bickerstaff, general secretary of the National Union of Public Employees, said that over the last 13 years his members' pay had fallen behind that of other workers.
'Judges and generals seem to do very well out of the top pay review body. It seems to be one rule for them and another for the low paid.' Nalgo, Nupe, and the health union Cohse are merging to form 'Unison', an organisation with 1.5 million members.
Typical annual salary of local government and health workers
Manual grades basic pay for 39-hour week
Refuse collector pounds 7,908
School meals assistant pounds 7,014
Hospital domestic pounds 5,942
Hospital porter pounds 6,124
Lab assistant pounds 6,535
White-collar staff average pay
Poll tax clerk pounds 10,140
Social worker pounds 16,484Reuse content