Police pay should be radically overhauled to reflect performance and skills rather than length of service, a leading think tank has said.

The Institute for Public Policy Research (ippr) report, to be published next month, comes as police officers prepare to march this week in a row over the latest pay deal.

The report shows that the pay of individual police officers increases irrespective of performance and skills level, awarding an annual increase of between 2 and 6 per cent for the first 10 years of service, on top of the agreed national pay rise.

The think tank argues that this system does not reward expertise and discourages officers from developing much-needed specialist skills, adding that that while crime has fallen dramatically since 1997, police performance has not significantly improved in the same period.

Guy Lodge, ippr senior research fellow, said: “We all know that the police do a difficult and challenging job but no system of pay is fair that rewards people solely on the basis of time served rather than their ability to do the job effectively. The current row over pay levels is preventing much-needed debate about how we reward police officers and how we deliver a high-performing police service.”

The research is timely, given the current police pay dispute prompted by the government’s refusal to backdate the 2.5 per cent pay award recommended by the Police Arbitration Tribunal last year.

The Police Federation, representing officers in England and Wales, said this effectively reduces the value of the pay award to 1.9 per cent for the year. A march on Whitehall planned for Wednesday 23 January will see up to 20,000 officers campaigning for a fairer pay deal.

The full report Modernising the Police Workforce, by Tom Gash, will be published by ippr in February 2008.