The Local Government Pay Commission has endorsed the national bargaining system against ministerial threats of regionalisation in its long-awaited report, to the joy of unions and employers alike.
This week's report also backs employers' claims that local government is not a low-wage sector, but seems to support the union case for increases in London pay by calling for parity in London weighting across the public sector.
But it also says non-pay considerations, particularly training and development, are fundamental to addressing recruitment and retention difficulties across the sector, particularly in social care.
The commission was set up as a condition of the settlement of last year's pay dispute, which culminated in a national strike by Unison, the GMB and the T&G.
Both employers and unions said that it provided a basis for future partnership.
Employers' Organisation deputy director Rob Pinkham welcomed the report as a 'ringing endorsement of the pay system in local government' through its defence of national agreements.
In his budget statement, chancellor Gordon Brown had called for a greater regional and local dimension to public sector pay, but the commission said local government was already leading the way in local flexibility.
Mr Pinkham said the report also backed the employers' argument that 'there is
not a case for a general hike in pay rates at the bottom end', contrary to the claims of the unions.
GMB national secretary Mick Graham admitted this had disappointed the unions, given the evidence that local government wage growth has fallen behind the rest of the economy in recent years.
However, he said there was 'more in the report for the trade unions', citing its call for greater investment in training, and London weight ing parity across the public sector.
The report's strongest language is on equality, where it calls for increased government intervention through mandatory pay audits and, possibly, the inclusion of equal pay as a comprehensive performance assessment indicator.
This would have to be accompanied by greater central funding, it adds.