GBP455m aid to help councils settle equal pay claims

Emergency funding worth £450 million will be made available to councils to help fund equal pay settlements for low-paid female staff.

Local Government Minister John Healey has announced that 34 councils will be able to borrow raise up to £455 million overall, either by borrowing against or selling assets. 

It is the second time this year the government has stepped in to free up cash for compensation. Earlier this year, ministers allowed councils to borrow £550 million. The aid is intended to help speed up deals that could result in individual payments totaling tens of thousands of pounds.

Up to 400,000 low-paid female council staff across England are due new pay agreements and back-pay deals, dating back up to six years. It follows the 2004 ruling on gender inequalities in pay structures for council workers.

Some councils have been slow to react due to the £3bn cost of reimbursing workers such as dinner ladies and cleaners, who have been paid less than male counterparts in similar skilled roles.

No win-no fee lawyers, however, have spurred councils into action to clear the claims after securing big payouts for staff.