Hutton: Public sector pay hike is unjustified

THE public sector has failed to justify a rapid rise in salaries for top executives, according to an influential new report.

Will Hutton, the executive vice-chairman of the Work Foundation, has recommended senior public servants’ pay should be directly linked to their performance and should be subject to far greater public scrutiny.

Under his proposals public servants will have a percentage of their basic pay “at risk” each year, with the money earned back by meeting performance targets.

However, he fell short of recommending a fixed limit on pay multiples, whereby executives could only earn 20 times more than their lowest paid workers.

He also warned against using the Prime Minister’s pay as a benchmark for the earnings of other senior public servants.

Instead he said both the public sector and listed companies should be required to track and publish their pay multiples to make it easier to compare earnings of top executives.