Thursday, June 23, 2011

Private-Public Wage Disparities

Private-Public Wage Disparities: FCPP - Frontier Centre for Public Policy

According to a CFIB 2008 study, taxpayers would save $19-billion a year if publicsector wages were equalized with private-sector ones. And that only includes those civil servants with direct private sector equivalents -in other words, no police, firefighters, etc. were included.

That's an amazing figure.  $19 billion.  That's almost 10% of the federal budget, and make no mistake, the federal budget makes up the brunt of that figure.

The opposition were asking where the $4 Billion hole in the Conservative plans to cut spending are... this is it right here.  The media party should be trumpeting this from every platform they could find... if they had a mind towards really making sure the cuts happened rather than just trying to embarrass the governing party.  Some of Mr. Levitt's proposals on how to change bargaining in the public sector are very interesting:

First, fire the advisors and lawyers who have brought us to this precipice and are comfortable with conceding.

Second, take tough positions at the bargaining table and, if the union strikes (which they are less likely to if they believe this will occur), make sure the cost of the strike is taken out of the employees future salaries and benefits before the strike is settled. With one not-for-profit client I negotiated for, we told the team-sters every time our offer was rejected, the next would be less. On the third offer, they believed us and accepted the reduced offer. The next time they didn't strike.

Third, the government should pass legislation requiring arbitrators to make comparable salary and benefits in the private sector their main criteria. Couple that with provisions requiring them to adjust wages up or down to accomplish that. If that occurred, ordering workers back to work would have teeth.
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