Support for pay bodies increases

THE GOVERNMENT is facing mounting pressure to abandon its plan to abolish wages councils which dictate the pay of 2.5 million of Britain's poorest workers, writes Barrie Clement.

The politically independent Industrial Society today joins forces with unions and pressure groups to denounce the Government's 'bargain basement' approach to pay, while a report published yesterday by the National Group on Homeworking warned that the wages of many homeworkers could sink to about pounds 1 an hour if the councils were wound up.

Rhiannon Chapman, director of the Industrial Society, said that Treasury advisers were approaching the pay issue 'with all the finesse of a dentist extracting teeth with a road drill'.

Writing in the society's newsletter, she said that government plans to limit public service pay rises to 1.5 per cent and to eliminate wages councils amounted to 'half-baked solutions that ignore economic realities and are unfair into the bargain'.

For a pay policy to work, those on the receiving end should be able to discern a coherent policy, and feel that anomalies would be tackled, she said. Ministers did not appear to share this view. They should be aware that such policies fuel pay explosions later.

Of wages councils - to be abolished as part of the Trade Union Reform and Employment Rights Bill - she said: 'It is not obvious how the economy will be helped by licensing poverty-pay cowboys to undercut reputable companies providing a respectable service.'