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BBC £450 flat rate rise

If members follow the unions' advice to accept the offer, the increase will take effect on 1 August, the normal pay anniversary date.

The offer covers all staff employed directly by the public sector BBC, and employees of BBC Studios and Post Production (S&PP - formerly BBC Resources). In S&PP it applies only to staff who do not receive a contractual bonus.

Staff on salaries over £60,000 a year will not receive any increase, in line with a general BBC policy to freeze the pay of high earners this year which has already denied increases to staff above Bands 2-11, who are not covered by collective bargaining.

Staff close to the £60,000 cap will receive less than the full £450, but those near the £25,000 threshold below which high-rate London Weighting is paid have been guaranteed the full increase on top of their current income, and will not lose out because their London Weighting drops.

In a departure from normal practice, the increase will not lead to a rise in allowances like London Weighting, or Days UPA payments, nor will the floors and roofs of most pay bands be increased. However, under pressure from unions, the BBC agreed that the floors of Bands 2-4 would be increased by £200 as a concession to lower-paid staff.

This year's pay claim, submitted on 28 January, had called for a flat rate increase of £1,800 for all staff, but in a financial presentation from management at the pay talks on 28 May, the BBC argued that the general economic climate, and in particular the BBC's financial outlook, had altered dramatically.

At the time of the claim the Retail Price Index was still rising, albeit at only 0.1% year-on-year. Now, it is negative, with the latest data showing a rate of -1.2%, and some forecasts indicating that it could drop even further.

Coupled with falling inflation, the BBC's guaranteed 2% annual increase in Licence Fee income had been undermined by several trends which had not been built into the Corporation's long-term financial planning. These included a slowdown in the creation of new households, an anticipated increase in licence evasion due to rising unemployment, and the collapse of the commercial property market which left the BBC still owning four major buildings which it had hoped to have sold by now.

Management went on during the 28 May meeting to make an offer of a £385 flat rate increase, which was rejected by the unions on the spot. For the rest of the five-hour meeting the unions pressed the BBC to improve its offer to staff, particularly the lower-paid, despite its financial difficulties, and the proposed £450 emerged as a final offer. The management side emphasised that this was the best that could be afforded, and revealed that the BBC had seriously considered imposing a pay freeze on all staff this year, not just the highest-paid.

Based on discussions the previous day between union representatives from across the country, negotiators decided that this offer was unlikely to provoke sufficient opposition amongst members to prompt a strike ballot, even though it fell far short of the claim.

The unions also want to reserve energy for fights over pensions and job cuts that may be on the horizon. Despite a pay increase that many will regard as modest - the £450 represents approximately 1.5% of the average BBC salary - the Corporation is still looking for savings, and the triennial review of the pension scheme in April 2010 is almost certain to report a deficit, which could lead management to consider further changes to benefits and contributions.

More information about the timing of the postal ballot will follow.

Text of the formal written offer from the BBC:

 

^{Mr G Morrissey
BECTU}

^{29th May 2009}

^{Dear Gerry}

^{Re: 2009 Pay Negotiations}

^{I am writing to confirm the BBC’s final offer for the 2009 pay settlement which has been agreed on the basis of a positive recommendation with the unions in the context of unprecedented financial pressures on the corporation and the economy.
 
This year’s pay settlement is a one year deal which applies to staff employed on grades 2-11 within the public sector BBC and, for this year only, staff who work within BBC Studios and Post Production (formerly Resources) who are not entitled to a contractual bonus.
 
The pay settlement is a flat rate consolidated increase of £450 per annum to basic salary to take effect from August 1st 2009. This is subject to an upper earnings cap of £60,000 meaning that staff whose basic salary exceeds £60,000 will not receive an increase this year. Those staff whose basic salary is currently between £59,551 and £59,999 will receive a proportional amount of the flat rate increase which would take their basic salary to the cap of £60,000. As an example, a member of staff whose basic salary is currently £59,900 would receive an increase of £100 to their basic salary.}

^{The floors and ceilings of grades 2 – 11, Flexibility Allowances, UPA (Days), Night pay, Christmas Day, Boxing Day and New Years Day and other protected continuing allowances will remain at their current rate and will not be increased as part of this years pay deal.}

^{The only exception to this is that the BBC has agreed to uplift the floors of grades 2 - 4 by a flat rate of £200. However, where individuals are currently paid at the base of these grades they will only receive the flat rate increase of £450.}

This letter has been sent to the NUJ and Amicus.

Yours sincerely

^{Mike Gooddie
Employee Relations and People Strategy Director}