Policy Exchange -
This paper analyses the most recent Labour Force Survey data (January-March 2013) and reveals that there is still a gap between public sector and private sector pay, the amount varying dramatically from region to region. It argues that the variation in pay has arisen because of the system of national pay bargaining, meaning workers are paid the same amount regardless of where they live. The paper recommends abolishing national pay deals and moving to a system which can reflect local labour markets and reward performance. It also urges the government to push ahead with its plans to remove automatic pay uplifts across the public sector.