The Government has confirmed that millions of public sector workers will get pay rises of up to 7 per cent after it accepted recommendations from pay review bodies “in full”.
Announcing the decision the Prime Minister, Rishi Sunak, called on unions to cancel disruptive strike action.
He insisted the pay offer is final, adding: “There will be no more talks on pay.”
The changes will affect around a million workers employed in the public sector across the UK, including 460,000 teachers, 200,000 Armed Forces personnel, 140,000 police officers and 75,000 junior doctors.
When will the public sector pay rise begin?
These pay increases will apply to the current fiscal year and will be backdated to April 2023.
It is yet to be confirmed whether the backdated pay will arrive in workers’ July or August pay packets.
How much are workers getting?
Teachers will receive a 6.5 per cent salary bump, which union leaders will recommend their members accept. This would put an end on long-running strike action in classrooms.
The Prime Minister, the Education Secretary, Gillian Keegan, and the general secretaries of the four education unions released a joint statement after the pay deal was announced, saying it “recognises the vital role that teachers play in our country and ensures that teaching will continue to be an attractive profession”.
Members of the police will get a 7 per cent increase, junior doctors will get a 6 per cent pay increase plus a bonus of £1,250, and hospital consultants, set to strike in England next week, will receive a 6 per cent rise, as will dentists.
Senior civil servants will receive a 5.5 per cent rise, and most members of the Armed Forces will get a 5 per cent increase plus a bonus of £1,000. There will be 5.5 per cent awards for the most senior officers.
Prison officers in the operational bands will receive an increase of 7 per cent, with larger rises for support grades and 5 per cent for managers and governors.
How will the pay rises be funded?
John Glen, Chief Secretary to the Treasury, told MPs that money for the pay rises would be found through “greater efficiency and reprioritisation” within existing budgets.
He added there would be “no new borrowing or spending to fund the awards” as “new borrowing is itself inflationary.
“More borrowing would simply add more pressure on inflation at exactly the wrong time, risking higher interest rates and higher mortgage rates.
“Instead, the awards will be funded through a combination of the significant provision for pay that was made at the last Spending Review, greater efficiency, and reprioritisation.”
He explained in the Commons that the Department of Education would fund its pay rises by finding funding within existing budgets. Pay increases for junior doctors would be funded by increasing the immigration health surcharge to £1,035.
To fund the pay increase for police, the cost of certain visas would be increased by up to 20 per cent to create more cash for border forces – allowing the Home Office to divert some money towards police officer pay.
What has the reaction been?
At a Downing Street press conference the Prime Minister called on the British Medical Association (BMA) to help “make the NHS strong again” and avoid further disruption.
“The Government has not only made today’s decision on pay. We’ve backed the NHS with record funding, delivered the first ever, fully funded long-term workforce plan and met the BMA’s number one ask of Government, with a pensions tax cut worth £1bn,” he said.
“So, we should all ask ourselves, whether union leaders – or indeed political leaders – how can it be right to continue disruptive industrial action?
“Not least because these strikes lead to tens of thousands of appointments being cancelled – every single day and waiting lists going up, not down.”
The BMA said the offer of a 6 per cent pay rise is not enough to end the junior doctors’ dispute. The union is calling for pay restoration for junior doctors following years of real-terms pay cuts, which would amount to a 35.3 per cent pay rise. The Government has called the demand “unrealistic and unaffordable”.
BMA chair, professor Phil Banfield, told BBC Radio: “We need to sit down and see whether this will allow us to go into negotiations. It could be a reasonable starting point for us to progress the dispute.”
The Prospect union’s general secretary, Mike Clancy, said the Government was “taking a knife to public services to pay for these pay rises”, showing “they have learned nothing from the austerity years”.
“For a Prime Minister and Chancellor who came into office promising economic stability, the chaotic handling of this process will inspire little confidence in workers worried about their futures during the worst cost-of-living crisis in a generation,” he said.
Liberal Democrat leader, Sir Ed Davey, said: “Rishi Sunak is taking a wrecking ball to our public services with these savage cuts.
“He must come clean about the devastating impact this will have on local hospitals and schools across the country.”
For Labour, shadow Treasury Chief Secretary, Pat McFadden, questioned whether the Government will cut back on capital investment in schools and hospitals to fund the increases.
Police Federation national chairman, Steve Hartshorn, said the 7 per cent rise was “a step in the right direction” but “we must not lose sight of the fact that this uplift still fails to take account of the real term cut of 17 per cent officers have suffered since 2000”.
What are pay review bodies?
Pay review bodies are independent panels that advise the Government on pay for public sector workers.
The eight bodies are each made up of between six and eight people, including sector experts, HR experts, economists and former trade unionists.
They cover pay for around 45 per cent of public sector workers, including members of the Armed Forces, NHS staff, prison officers, police officers, teachers and senior civil servants.
They look at a range of evidence when making their recommendations, including submissions from trade unions and employers focusing on pay and retention, as well as formal offers from the government and their own research.
They also consider other factors set out in the remits they are given by the government each year. This can include the government’s inflation target, the amount of money departments have been given to spend overall, variations in labour markets and policies for improving public services.
The pay review bodies then make a formal recommendation to the government on pay levels, which can vary according to job type or seniority.
But ultimately, it is up to the government to set public sector pay levels and it is not bound to accept the pay bodies’ recommendations.