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Civil servants, National Health Service staff, council officials and other public sector workers have enjoyed a 'golden age' under the Labour government, according to an investigation by the Sunday Times.
Figures from the Office for National Statistics (ONS) show that average annual earnings of public sector workers rose to 22,405 Pounds last year compared with 20,988 Pounds paid to the average private sector worker.
Figures from the ONS also show that public sector productivity has fallen by 3.4% over the last 10 years compared with a rise of 28% in the private sector during the same period.
Most civil servants also receive employer pension contributions of 19.4% of their salaries, which is more than three times the average of 6% paid by private sector employers.
Graeme Leach, Chief Economist and Director of Policy at the Institute of Directors (IOD), said "it is ridiculous that pay and perks have risen when public sector productivity has fallen. This gravy train now has to come to an end."
The generous pay and perks offered by state employers have encouraged increasing numbers of graduates to favour working in the public sector. Almost 39% of public sector workers are graduates, up from 25% in 1998. Only 20% of private sector workers have a degree.
A spokesman for the Treasury said that the higher average pay of public sector workers was partly due to the fact that many cleaning jobs and other low-paid public sector work had been outsourced to the private sector.