Briefing from the Prime Minister’s Official Spokesman on: PM’s Speech on Europe, Fire Dispute, NHS Pay/’Agenda for Change’, Anglo-French Relations and Middle East.
PM’s Speech on Europe
The Prime Minister’s Official Spokesman (PMOS) briefed journalists on the content of the Prime Minister’s speech on Europe which he was making in Cardiff this afternoon. It was a thoughtful and important speech which would focus on the Future of Europe debate and the Convention being chaired by former French President Valéry Giscard D’Estaing, as well as the challenges and opportunities which enlargement presented. In summary, the speech would say that Europe should do more, but on the basis of nations, not a federal state. As it did more, its anchor would be the nation state, and that meant stronger institutions at every level.
Fire Dispute
The PMOS drew journalists’ attention to a letter which the Deputy Prime Minister had sent to Sir Jeremy Beecham of the LGA following their meeting at lunchtime today. Exploratory talks between the employers and the FBU were due to take place tomorrow. As he understood it, there was now a streamlined team of councillors who would oversee the negotiations which would continue to be conducted by the same body as before. However, this letter would now ensure that there was absolute clarity regarding the parameters of that negotiation in relation to the Government. It would underscore the fact that public spending limits were fixed and would not change and that anything above the figure being offered must be paid for through modernisation. We did not want to be placed in the position we had found ourselves in last Friday when a deal had been done, but it had then been presented to the Government - not for approval or for a blessing - but with a request to fund it. There had to be rigorous costings - properly checked and audited - so that we could see what changes there would be and by when and what savings would be released to fund any potential pay rise.
Asked how many members were in the streamlined team of councillors, the PMOS said that as he understood it, the team comprised five or six people. Put to him that the previous negotiating team had contained four people, the PMOS said that the same negotiators as before would continue direct talks with Andy Gilchrist, the leader of the FBU. However, a ‘guiding’ group had now been appointed whose role was to oversee the discussions, rather than report back to a team of around 40 people as had happened previously.
Asked about the significance of the fact that the letter did not mention the Bain Review despite the fact that the Prime Minister referred to it constantly in his news conference on Monday, the PMOS said there was no significance. As far as we were concerned, the Bain report remained the blueprint for the talks. Bain continued to be integral to the approach of the Deputy Prime Minister every bit as much as it was the approach of the Prime Minister. He cautioned journalists against pursuing another ‘mixed message’ story - as they seemed to be in vogue - because none existed.
Questioned further about the Deputy Prime Minister’s letter, the PMOS said that it set out the principles of the Government’s approach to fire service pay. It stated that the employers had a mandate to negotiate. However, they should be aware that public spending limits were fixed and that any additional funding had to be found from modernisation. We regarded Bain as the blueprint to inform the discussions. If the employers came up with proposals, they had to be rigorously costed and it had to be clear where the savings would be found. That had to be the right way forward. Put to him that the letter would annoy both the employers and the FBU, the PMOS said we wanted to ensure that we did not have a repeat of events last Friday when a deal had been put together which would have cost the Government millions of pounds. As we entered another round of negotiations, it was important for the ground rules to be clear to all sides in terms of the Government’s role and the flexibilities of the employers to conduct their negotiations. Given what had happened last week, surely people would accept that defined parameters was a desirable thing to have.
Asked to explain how the employers would know whether they were putting economic stability at risk (Principle 1 in the Deputy Prime Minister’s letter), the PMOS pointed out that they had a three-year local authority pay settlement. We had underlined that anything over the 4% figure for the first year had to be funded through modernisation. Any extra money, therefore, had to be properly costed through changes in working practices. We had made clear that any extra money had to be self-financing. We had also underlined that any pay deal over a period of years had to be properly funded. Questioned further, the PMOS said the bottom line was that any extra funding over and above 4% had to be paid for through modernisation. For all the discussion there had been about modernisation and commitment to reform, we had yet to see detailed numbers which showed how a pay award of 16%, let alone 40%, or whatever, would actually be met. Until that happened, the rigour wasn’t there that would allow a deal to be concluded.
Put to him that the Deputy Prime Minister’s letter represented a gun being held to Sir Jeremy Beecham’s head - which destroyed the Government’s pretence that it was not getting involved in the dispute, the PMOS said that it was not for the Government to get involved in the negotiations. However, the Government did have a role to play if, at the end of negotiation, it was suddenly informed of an additional cost to the Exchequer, as had happened last week. So the Government had found that it did have a locus in the issue. The purpose of the Deputy Prime Minister’s letter to Sir Jeremy was to set out the parameters of the negotiation in relation the Government for the avoidance of doubt. Put to him that the Government was more interventionist than he was suggesting and did more than simply hand over money to the local authorities, the PMOS said that he had not heard the local authorities say that they wished to cut other budgets in order to give more to the fire service. He had, however, heard them say that they wanted additional money from the Government to fund additional pay. Our response to that was that everything had to be properly funded and paid for by rigorous and costed savings through the modernisation of working practices.
Asked about comparisons with the NHS ‘Agenda for Change’ agreement which had been signed today, the PMOS said he did not think that it would be helpful to draw comparisons. The NHS agreement had come about as a result of a three-year negotiation between NHS staff, the unions and the employers. There was no reason why the FBU shouldn’t withdraw the threat of future strikes, sit down at the negotiating table and thrash out a deal. They wanted a new pay formula - but they also wanted a pay rise before that had even been agreed. That was not the way to move forward. Questioned repeatedly about a read-across between the two, the PMOS refused to elaborate any further.
NHS Pay/’Agenda for Change’
Questioned about the conclusions of the ‘Agenda for Change’ talks relating to NHS pay and modernisation, the PMOS noted that an agreement had been reached as a result of some considerable period of negotiation and it showed what could be achieved through discussion. The agreement had been negotiated on behalf of around a million NHS staff, comprising seventeen different unions. It was the biggest modernisation of NHS pay since 1948. As Alan Milburn had pointed out, it was a something-for-something deal. The agreement gave a 10% basic pay increase over three years for all staff. When the costs of other parts of the reform package were added in over the next three years, it would be worth an average increase of 12.5% in basic pay. We believed this was fair for NHS staff and good for the NHS and its patients. The agreement meant that there would be a more sensible division of labour with nurses, therapists and health care assistants, for example, taking on new roles which would improve overall productivity. It would also mean that support workers would be able to undertake tasks traditionally done by nurses, such as taking blood, dressing wounds and giving injections. As a result, nurses would be able to take on tasks traditionally carried out by doctors, such as prescribing. That, in turn, would relieve pressure on clinicians. According to the calculations, it would help to free up 2% of consultants’ time and 15% of other hospital doctors’ time. There were also new freedoms and flexibilities for local NHS employers to create new types of job and post staff more in high cost areas. Thus, there was a very clear connection between rewards for staff and responsibilities. It underlined absolutely our commitment to more pay and fair pay, as long as it was linked to modernisation and changes in working practices, and would clearly benefit the community. It was also evident that the changes being made were not only good for the NHS, but would offer more rewarding careers for NHS staff because we were knocking down some of the artificial barriers which had held them back over the years. Asked if any of the money was new money or whether it would all have to come from savings, the PMOS said that the money was from budgets which had already been set out. We were investing huge extra funds in the NHS. Pay was a very large part of the budget. Consequently, much of the reform we wanted had to be tied to pay.
Questioned about the employment of new staff, the PMOS said that we were looking to recruit 37,000 more staff over the three-year period. We had always made clear that a quantity of the substantial extra sums going into the NHS would address the problem of under-capacity. Pay was a very big part of the NHS budget. Consequently, if changes were being made, it was obvious that pay reform would play a major role. It went without saying that we wanted to attract more people to work in the NHS, and in fact there were already vacancies for nurses.
Anglo-French Relations
Asked about the open letter to President Chirac of birthday congratulations which had appeared in a French publication today, the PMOS said that the Prime Minister had sent a letter congratulating the President on his 70th birthday. Asked if the Prime Minister was trying to make amends following his reported row with the President at the European Council in Brussels, the PMOS said we had never denied the fact that there had been a disagreement over the issue of CAP reform. The Prime Minister and President had had a perfectly amiable meeting in Prague last week and the relationship between the two remained fundamentally strong. Of course that did not mean that differences would not arise at various times, but these certainly did not define the relationship. Asked when the Anglo-French Summit was due to take place, the PMOS said that a date had not been set at this stage.
Middle East
In answer to questions about John Reid’s comments on the Middle East at his press briefing this morning, the PMOS said that Dr Reid had simply been repeating our desire to try to move things forward. He had not been signalling anything new.
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