Public sector pay rises offer ‘only partial relief’ for workers – and funding it from cuts elsewhere is ‘self-defeating’, warns IPPR

Responding to the government’s announcement of pay rises for teachers, health workers and other public servants of between 6 and 8 per cent, IPPR experts have challenged both the level of pay offered and how it will be funded.

Carsten Jung, IPPR senior economist, said:

“Today’s public sector pay announcements offer only partial relief to workers across our schools, health service and other vital public services, compared to the 10.5 per cent real cuts in their earnings since just before the pandemic – never mind the previous decade of austerity. They also mean lower pay rises than across the private sector, which will only worsen the public sector workforce crisis.”

Dr George Dibb, head of IPPR’s Centre for Economic Justice, said:

“By insisting that departments find the funds for pay rises from existing budgets the Treasury is risking even further degradation of essential public services. Cutting health budgets to fund junior doctors' pay rises is self-defeating.

“Far better would be to fund these through tax increases, which could at the same time make the UK’s tax system fairer. Even if this was funded by borrowing in the short-term, inflationary pressures would be small.”