Somebody asked me in an earlier comment why I was incensed by the number of people earning over £100,000 in the public sector. Well they are a relatively small number, but they are a number earning salaries out of all proportion to their importance.Let us assume for a moment (and it is admitedly a poor assumption but it helps us put things in perspective) that the level of pay in the public sector conforms to a normal distribution. Now I will be the first to admit that wouldn't be the case and you could come up with some other statistical distribution, but this works for the purposes of understanding.Now we know that the public sector wage bill is around £175 billion and there are 6.051 million public sector workers, which means that the average cost of employment is around £29,000. We also know that due to the minimum wage there are no full time equivalent employees earning less than £14,000, so the difference between £29,000 and £14,000 would be about the same as 3 standard deviations, or one standard deviation is about £5,000. Which means that anyone earning more than £100,000 would be about 14 standard deviations higher than the mean, which implies a probability far closer to zero than the observed 38,000 / 6.051m = 0.6%.
Now I am not saying that salaries should be determined by statistical analysis or that they should be consistent with any particular statistical distribution, but it is clear that after the last Labour government there is a considerable amount of kurtosis (fat-tailness) with senior public sector workers choosing to pay themselves on a different scale to the rest of the public sector.
As John Redwood pointed out, in the private sector workers and management generally work to cut costs without whingeing about loss of services to customers if they can't keep their prices up. Would that the same applied in the public sector.