Public sector to get 3-year pay deals to stop strikes

The Government plans to launch a drive to secure three-year pay deals for public sector workers to head off the threat of a wave of strikes.

The Government plans to launch a drive to secure three-year pay deals for public sector workers to head off the threat of a wave of strikes.

Downing Street officials are considering proposals to replace the traditional annual pay round with longer-term deals in the hope it will send a signal of support.

One option is to dovetail long-term salary deals into three-year spending programmes such as the one unveiled by Gordon Brown last week. The Treasury is not keen on this idea, believing it would smack too much of an old-style incomes policy.

But the Treasury is encouraging Whitehall departments to conclude long-term settlements for individuals. A Treasury source said last night: "Inflation is low and people expect it to remain low. That provides a good environment for people to strike multi-year deals to benefit from and lock in that stability."

This week, 13,000 blue-collar workers at the Ministry of Defence won rises of 24.5 to 30.8 per cent over four years.

Some ministers want to use big pay rises as a "carrot" to secure reforms to working practices. The Department of Health is considering a plan to offer nurses 9 per cent, which would raise the starting rate for a newly-qualified nurse by £1,500, to £17,500 a year.

There would be flexibility to offer more money in areas with recruitment problems, such as London and the South-east. But the department said: "This will not be a something-for-nothing arrangement. As nurses take on new roles and responsibilities, they have a right to expect a fair reward. In return, the NHS has a responsibility to gain improvements in flexibility and productivity."

Talks aimed at ending the dispute involving council workers will be held at the conciliation service Acas today. Local authorities tabled a new offer yesterday which included a new minimum rate of £5 an hour ­ up from the present lowest of £4.82.

But a spokeswoman for the Unison union strongly denied the dispute had been settled. She said: "We have heard the proposals but we want to see how that affects the overall package. We need more money on the table, not a re-working of the 3 per cent offer."

Yesterday Tony Blair said the unions would not drag Britain back to the days of widespread industrial strife. He told a Downing Street press conference that he did not believe recent disputes, such as those affecting local authorities, the railways and London Underground, were a sign of major difficulties ahead.

"The trade unions have a right to be listened to but they don't govern the country," Mr Blair said. "We govern the country because we were elected by the people. I think they [the unions] recognise that there is no mileage in this for them, in trying to go back to the bad old days. It is not going to happen. It will never happen whilst I'm Prime Minister.

"I don't think there's any support for it in the country, and I don't think there's really any support for it in the trade union movement. You may get the odd trade union leader on a sort of political kick, but I don't think most of them are in that way."

The Prime Minister's difficulties with the unions deepened last night when Derek Simpson, the new leader of Amicus, accused him of moving away from Labour's core support.

Mr Simpson told The Times newspaper: "This Government ... is too centrally controlled and has too little democracy. Labour has moved too far away from its roots and from working people."