Friday, April 01, 2022
Is public sector pay policy deepening cost of living crisis?
The answer to that question is of course, yes. The Guardian reports that public sector unions have reacted with fury after ministers announced that pay increases across the civil service would be pegged at an average of 2% for the year ahead, despite surging inflation.
In contrast, the paper says that the latest official figures showed average pay across the economy was increasing at an annual rate of 4.8%. It is little wonder that the director of the Institute for Fiscal Studies thinktank, Paul Johnson, has suggested that with civil service pay already having been hit by a decade of real-terms pay cuts, the government are “testing the limits of employee patience and of the labour market”:
Meanwhile, analysis from the Health Foundation showed that soaring inflation meant NHS staff faced an average pay cut of £845 during 2021-22 and will see their income shrink by even more in 2022-23.
Staff lost at least £845 on average, although for some this was as much as £1,690, because their 3% pay rise was outstripped by inflation as measured by the consumer prices index, which hit 5.5% in February. They were awarded the 3% last summer when inflation stood at 1.6%.
They are facing an even bigger drop in real-terms income in 2022-23 because while ministers have offered them 3% again, the Bank of England has forecast inflation to rise to as much as 8% soon.
“NHS staff are already consumed by money worries when they’re at work giving vital care. These figures show why,” said Sara Gorton, the head of health at the union Unison. “Health workers need a wage rise that helps them absorb the eye-watering bill increases ahead. Otherwise they’ll leave for better-paid work, which will be a disaster for patients.”
We cannot go on treating public servants in this way, not least health and social care workers who took the brunt of the heavy lifting during the pandemic. Government needs to respond to the cost of living crisis by protecting its own workers from the worst impact of soaring bills, while also putting in measures that will help the wider population as well.
In contrast, the paper says that the latest official figures showed average pay across the economy was increasing at an annual rate of 4.8%. It is little wonder that the director of the Institute for Fiscal Studies thinktank, Paul Johnson, has suggested that with civil service pay already having been hit by a decade of real-terms pay cuts, the government are “testing the limits of employee patience and of the labour market”:
Meanwhile, analysis from the Health Foundation showed that soaring inflation meant NHS staff faced an average pay cut of £845 during 2021-22 and will see their income shrink by even more in 2022-23.
Staff lost at least £845 on average, although for some this was as much as £1,690, because their 3% pay rise was outstripped by inflation as measured by the consumer prices index, which hit 5.5% in February. They were awarded the 3% last summer when inflation stood at 1.6%.
They are facing an even bigger drop in real-terms income in 2022-23 because while ministers have offered them 3% again, the Bank of England has forecast inflation to rise to as much as 8% soon.
“NHS staff are already consumed by money worries when they’re at work giving vital care. These figures show why,” said Sara Gorton, the head of health at the union Unison. “Health workers need a wage rise that helps them absorb the eye-watering bill increases ahead. Otherwise they’ll leave for better-paid work, which will be a disaster for patients.”
We cannot go on treating public servants in this way, not least health and social care workers who took the brunt of the heavy lifting during the pandemic. Government needs to respond to the cost of living crisis by protecting its own workers from the worst impact of soaring bills, while also putting in measures that will help the wider population as well.
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