Chancellor announces austerity in same week as public sector pay increase

Despite warnings from think tanks and economists, Chancellor Rishi Sunak has told the public sector to brace for austerity.

24 Jul 2020| News

Chancellor Rishi Sunak privately forewarned government departments of his plans for austerity, it was revealed this week, despite his public announcement of a pay increase for public sector workers.

The government has been boasting what it says as “above inflation” pay increases for 900,000 individuals, but the wage rises will affect fewer than one in five public sector workers and excludes many professions, including nurses and carers. Even for those who will receive a larger wage this year, it falls far short of the money they have lost since the last tranche of austerity.

Now, even this olive branch to the public sector is being described as a “cynical ploy” by the TUC, after letters leaked letters from Sunak to govermment ministers showed plans for future pay restraint.

TUC General Secretary Frances O’Grady said: “It’s hard to see how public sector workers can trust ministers after this cynical ploy to disguise plans for more pay restraint.

“In the last decade, we learned the hard way that austerity and pay restraint slow down recovery. People have less to spend. Businesses have fewer customers. And it holds back growth.

“If ministers take this failed approach again, the living standards of both public and private sector workers will take a hit. And the key workers who saw us through the pandemic will be denied the pay rises they have earned. That’s no way to thank key workers.

“The prime minister promised no austerity after the pandemic. We need a recovery plan based on decent jobs with fair pay.”