A proposal by the government to introduce regional variation in public sector pay has been greatly discussed in recent times. The idea is that because the cost of living is more expensive in one place and less expensive in others, pay should variety to reflect that.
Having listened to the arguments on Question Time last Thursday, one of the suggestions was that, taking teachers as an example, the areas which have higher pay would then become magnets for the best teachers and other areas would be left with lower standards.
This completely misses the argument that the cost of living is different and therefore the pay would simply reflect this – in actual fact, it is the lack of regional variation should cause such a problem – if you get paid the same but your cost of living is cheaper, your effective pay is currently higher in the North East than it is in London.
However, I don’t support regional pay variation for that reason.
I’m going to use London as an example here, but in reality London could be replaced by any other big city. Indeed, London is perhaps not the best example given a divide in pay already exists in the form of London weighting. But given its relative size to other places in the UK, I’m going to proceed none the less.
Whether you truly believe there is a strong North South divide or not, it is hard to deny that as a country, we are very London centric. Not to the extent of other countries (Helsinki in Finland for example), but the best jobs, the biggest companies, museums, theaters, events, etc, etc are almost always bigger and better in London.
It then becomes self propelled – the big cities become more attractive places to live as they grow and grow, adding more exciting attractions, therefore attracting more people, and the cycle goes on.
London in itself is attractive enough to bring in talent in the public sector, and therefore we don’t need to offer people a pay packet which is effectively equivalent to those in other areas. To maintain a balance between the biggest cities and the rest of the country, we actually want to pay people more for not living in these places, which are attractive enough already.