IF TWO domestic issues will determine whether this Labour government is judged a success or a failure, they are whether it can reverse 15 years of shrinking incomes and whether it can deliver palpable improvements to an NHS in crisis.

A roadmap for restoring real-terms pay to its 2010 value is essential to both. The NHS is by far the largest employer in the country: raising wages in the health service directly benefits millions of families and strengthens the bargaining power of labour across the workforce, helping raise wages in general.

Years of pay erosion are also directly linked to a worsening service. The NHS is carrying over 100,000 vacancies in England alone. Understaffing means delays in seeing patients, which is why more than seven million people are now on waiting lists. Recruitment and retention depends on ending the progressive impoverishment of health workers.

A major study published last week in the British Medical Journal revealed that high staff turnover can be linked to thousands of patient deaths every year. The problem is getting worse: research by the GMB union shows two-thirds of NHS workers have considered looking for other jobs in recent months, because of low pay and overwork leading to burnout — the latter is again down to the unfilled vacancies. Only serious investment in the NHS workforce can break this vicious cycle.

Health Secretary Wes Streeting should, therefore, agree to the demand by health unions Unison, Unite and the Royal College of Nursing (RCN) to scrap the pay review body that currently advises on NHS pay, and enter instead into direct negotiations with health unions.

It is not only true, as they argue, that this would save time and avoid the likelihood that a million NHS workers do not get their next pay rise on time in April because the government has waited on the pay review body’s report.

It would also be an overdue step away from the use of pay review bodies to duck ministerial responsibility for pay in the public sector, and towards the restoration of sectoral collective bargaining as the norm across the economy. It asserts the principle that pay, terms and conditions should be determined by negotiation between unions and employers, not set by supposedly independent experts.

Pay review bodies are not fit for purpose. They are not independent for a start, with ministers selecting their members, most of whom come from corporate and executive backgrounds, and determining their remit. Their recommendations are not binding either, with ministers under the previous government routinely disregarding them.

A growing number of unions are calling for pay review bodies in their sectors to be scrapped. Unison, Unite and RCN’s refusal to submit evidence to the NHS pay review body this year is a powerful statement of intent that they intend to fight for their members’ wage demands, not plead for a hearing from a government-appointed panel.

Support for sectoral collective bargaining — which would do much to end the race to the bottom on pay and conditions that has depressed wages across the economy — is implied in the government’s Make Work Pay legislation, based on the New Deal for Workers campaigned for by the TUC.

Yet it only commits to establishing it in one sector, social care. A priority for unions agreed at September’s TUC is to extend that to all sectors, with a collective bargaining summit planned in the first part of next year. Agreeing common bargaining agendas for particular sectors, and jointly demanding them of employers across those sectors, is a way to begin that work whether or not ministers are ready to legislate.

Declining to play along with the “independent pay review” farce sets an example that can be emulated elsewhere. In labour relations, neutral arbiters are a myth: it is a question of class power, and unions exist to exercise it.