Thursday, 26 July 2012

TPA spin on unions

You may have noticed that the Taxpayers Alliance recently published its "name and shame" report on the pay of trade union general secretaries. What caught my eye was a piece in the Telegraph by the TPA's now chief executive Matthew Sinclair. It's a useful demonstration of their approach. For example:
In their latest returns to the Certification Officer, 36 trade unions have reported that they gave their general secretaries or chief executives pay and benefits of more than £100,000. That compares pretty well with the private sector. According to the Institute of Directors, the average basic pay of a managing director in a small company (turnover up to £5 million a year) was £70,000. At a medium-sized company (turnover up to £50 million a year) it was £100,000. And even in a large company (with a turnover up to £500 million a year) it was £128,000.
Let's initially just focus on the stats he quotes. There's a nice piece of sleight of hand in there. Many union leaders have "pay and benefits of more than £100,000" and this compares well to the private sector. Ok, so in order to compare presumably we'll look at pay and benefits in the private sector? Er... no. The comparison is actually with average basic pay. Guess what, if you and I are paid the same, and you compare my pay and benefits with your pay I will have a bigger figure. Matthew does compare one union leader's salary with the IoD figure, but further down in the article he only gives the total figures for three other union leaders. They clearly aren't the same type of figure as the IoD one. I suspect most readers won't notice the changes in figure used in the article, and will simply compare the two.

You might also question how valid the comparison is in any case. The TPA have looked at 36 union leaders, but there are more than 36 TUs. I assume all they have done is pull out the examples of those whose pay+benefits are over £100k - ie they've left out union leaders who don't fit the picture. They then compare those cases they seem to have selected on size with the IoD average figures. Comparing selected specific cases with averages, what could go wrong? Guess what - I could pick out some highly-paid IoD members who earn more than the average IoD member.

Finally, is the TPA even comparing like with like in terms of roles? The GS of a trade union is surely the equivalent of a chief executive or managing director of a business. If you're looking at an average of all directors, surely you need to compare with a comparable figure for unions - ie include at the least all DGS and AGS positions. If you can't do that then surely the TPA should compare union GS salaries with MD/chief executive salaries, not the stat for all directors.  

UPDATE: Matthew replies on Twitter that he is using average fig for managing director, so I was wrong about the last point. Not going to delete it as a) I should have spotted it (it's in the text) and b) I put up the incorrect claim so I should be accountable for it.

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