Downing Street today warned an across-the-board real pay rise for Brits would be “reckless” as Boris Johnson dug in his heels despite facing a “summer of discontent”.
The Prime Minister’s official spokesman hit back as he indicated 5.5million public sector workers will see their pay rise by less than inflation.
Inflation hit 9.1% this morning in a new 40-year high - meaning nurses, teachers and other workers would need a 9.1% hike just to stand still.
But Boris Johnson’s spokesman said that would “chase inflation with wages”, push inflation up further, and therefore make the hike “worthless”.
The NEU teachers’ union today wrote to the government threatening strikes from October if they do not get an “inflation-plus” rise.
Rail staff have already walked out, and Royal Mail workers and criminal barristers are among other groups threatening to strike this summer.
But the PM’s spokesman said: “We will keep explaining to the public why we think this is the right approach.
“And we’re confident the public will understand that it would long-term have a bigger impact on their take-pay if we were to take actions, reckless actions now that could spike inflation.
“It’s important to stress that does not mean we do not want to reward public sector workers with a pay rise, we do.
“It’s just we must make sure we don’t do anything that would have a knock-on impact that feeds into this global inflation spiral.”
Despite the hardline stance, No10 defended plans to give benefit claimants and pensioners an above-inflation rise in April 2023.
This is because their rise will be based on inflation in September this year, which is set to be around 10% then fall back by next Spring.
Many campaigners say that rise is long overdue because benefits and pensions rose by less than inflation this year. But it has sparked comparisons between pensioners and millions of public sector workers who will get less in their pocket.
The PM’s spokesman said pensions do not have the same “spill-over effect” into the wider economy that wage rises do.
Asked if we were “all in it together”, the spokesman said: “We need to consider the issue of what is fair and right, and what is best for the UK public as a whole.”
Asked what was reckless about a 10% pay rise, he replied: “It involves chasing inflation with wages, so that you end up having a knock-on impact of pushing inflation ever higher and therefore means the pay people do take home is worth less.
“That’s not what the public want, it’s not what we want. So you need to strike a careful balance.”
Told some workers would be surprised to hear him describe a proper pay rise as “reckless”, he replied: “Only if you take the words out of context and didn’t add on the important caveat, that it’s because it would impact them directly if it was to feed into an inflationary spiral and therefore mean that the money they had was worthless.
“No one wants to see that. It is a difficult balance and the Chancellor and Prime Minister are focused on it.”
Keir Starmer's spokesman hit back: “The biggest threat to inflation in this country has been caused by a Prime Minister who’s lost control of this economy.”
