Glasgow's Finances and Equal Pay

Here's a link to The Herald newspaper which gives prominent coverage to the report from the Accounts Commission report on the likely impact of equal pay settlements on the finances of Glasgow City Council.

I think the piece is pretty fair although the number of outstanding cases is actually around 12,500 not 6,000 as the paper suggests.

The City Council is suggesting that equal pay settlement negotiations are proceeding smoothly, as planned, but this is nonsense, of course.

Because if that were true the outstanding equal pay claims would not all be heading back to the Glasgow Employment Tribunal in September - and the trade unions (GMB and Unison) would not be consulting their members on the need for industrial action. 

  

http://www.heraldscotland.com/news/16592694.glasgow-city-council-facing-unprecedented-financial-crisis-over-equal-pay-claims/

Glasgow city council facing 'unprecedented' financial crisis over equal pay claims

By Alan Simpson - The Herald



Scotland's largest council facing "unprecedented" financial crisis over equal pay claims

GLASGOW faces an “unprecedented” financial crisis as it moves to settle an equal pay claim of up £1 billion with watchdogs warning they are “seriously concerned” about the impact on public services.

A huge bill is looming to compensate female workers for being paid less than men for carrying out equivalent jobs over several decades.

More than 6,000 claimants are owed between £500 million and £1 billion in payouts and the council has been unable to say so far how it will meet the cost.

READ MORE: Union threatens strike action over equal pay claims

Now the Accounts Commission has raised fears that Glasgow is facing a period of unparalleled financial pressure on services at a time when it is already shouldering with a potential budget shortfall of £129 million.

The Commission said the scale of the settlement is likely to be “significant” and is unlikely to be bridged by traditional measures such as digging into reserves or selling assets.

This leaves the most likely option of “capitalisation” which would allow the council to receive a loan from the Scottish Government to raise the cash needed with payments spread over several years.

But this would also affect the council’s future budget settlements for many years to come.

“The scale and complexity of Glasgow’s socio-economic challenges are unique in Scotland and, like all local authorities, it’s facing considerable financial pressures,” said Graham Sharp, chair of the Accounts Commission.

“The council has made steady progress since our last report and has a good track record in making savings, but we are seriously concerned about the impact that resolving equal pay claims could have on how the council delivers public services, and we will be continuing to take a close interest in that issue.”

The ongoing pay dispute centres on the way some jobs were graded several years ago.

Women employed as carers, cleaners, catering staff, classroom assistants and clerical staff were paid £3-an-hour less than men in low-paid roles operating within the local authority.

In 2005, the council accepted flaws in their pay arrangements with settlements offered to staff who had raised equal pay claims.

But in March last year, a landmark hearing at the Employment Appeal Tribunal found that 6,000 women were now entitled to make additional claims.

The city is already facing a funding gap of £129 million over the next three years and is currently unable to cost the claims in its financial plans.

Work on developing a separate funding strategy is being carried out by the council in parallel with discussions with claimants.

However, the Accounts Commission praised Glasgow’s improvement in many fields, such as educational attainment in city schools, the wellbeing of children and greater health results.

This is despite having to make cuts of £102.5m through its Transformation Programme over the last two years.

READ MORE: Union threatens strike action over equal pay claims

Council leader Susan Aitken said: “The challenge of resolving equal pay is substantial and it would be unusual if it wasn’t a focus for the audit team. However, it is a challenge we are committed to deal with and we are making substantial progress.”

“At the heart of any Best Value audit is the question of whether the council is delivering quality services that respond to the needs of individuals and communities – and I’m pleased that clear and steady progress in Glasgow has been recognised.

“We are still relatively early in the current council term, but the City Government has translated its priorities into a positive strategic plan for the council and the city, which has the support of all parties”.



A City Council spokesman added: “Officers are working on the financial aspect of equal pay as part of the wider project to resolve cases. That work is ongoing.”

However, Unison is to ballot members for strike action after the union said it had lost confidence in the council to settle the claims.

Members said they had been “betrayed” by council negotiators who ended months of discussions to instead work out a deal behind closed doors.

But the council has denied this and said it remained committed to discussions on an offer that will be made in December, with its equal pay team working “as fast as possible” on the issue.