Rishi Sunak ‘will unfreeze public sector pay at the Budget’
Rishi Sunak splashes cash: Chancellor ‘will unfreeze public sector pay and increase the value of the national minimum wage’ at the Budget in salary boost for almost five millions workers
Rishi Sunak said to be planning to end the public sector pay freeze at the Budget Chancellor is also expected to announce an increase to national minimum wage Reports claim minimum wage could be increased from £8.91 to as high as £9.45
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Rishi Sunak will unfreeze public sector pay and announce an increase in the national minimum wage when he delivers his Budget later this week, it was claimed today.
The Chancellor will unveil his spending plans on Wednesday and there is a growing expectation he will take action to hike wages after the pain of the pandemic.
Unfreezing public sector pay and boosting the minimum wage would provide a salary boost to almost five million workers.
Mr Sunak hinted at changes yesterday when he said setting a ‘new pay policy’ will be ‘a topic for next week’s spending review’.
Rishi Sunak will unfreeze public sector pay and announce an increase in the national minimum wage when he delivers his Budget later this week, it was claimed today
Unfreezing public sector pay and boosting the minimum wage would provide a salary boost to almost five million workers
Average weekly pay in the private sector in April 2020 had fallen while average weekly pay in the public sector had gone up
It has been estimated that approximately 2.6million public sector workers – including teachers, police officers and civil servants – had their pay frozen during the coronavirus crisis.
But The Sun reported the freeze will be lifted while a significant increase is also expected to the minimum wage.
The minimum wage is currently worth £8.91 an hour for people aged 23 and over.
For people aged 21 to 22 it is worth £8.36 an hour and for 18 to 20-year-olds it is worth £6.56.
Sources told The Sun that the main hourly rate could go up by as much as 54p to £9.45.
That would be worth approximately an extra £1,000 a year to people in full-time work.
Such an increase would put the minimum wage on course to hit £10 an hour before the 2024 general election.
Unfreezing public sector pay and lifting the minimum wage would bolster Boris Johnson’s claims of shifting the UK towards a high wage, high skill economy.
The minimum wage level is set based on advice given to the Government by the independent Low Pay Commission.
The organisation will reportedly deliver its report and recommendations to the Chancellor today.
Any minimum wage hike will be welcomed by employees but there are some concerns in the Treasury over the impact it could have on smaller businesses.
Mr Sunak had yesterday hinted at changes on the pay front during an interview on the BBC’s Andrew Marr Show.
Approximately 2.6million public sector workers – including teachers, police officers and civil servants – had their pay frozen during the coronavirus crisis
Asked if public sector pay will increase, he replied: ‘That will be one of the things that we talk about next week in the spending review.
‘Obviously over the past year, we took a decision to have a more targeted approach to public sector pay given that the year before there were large increases and obviously the private sector was seeing pay decreases last year, and people were on furlough.
‘We thought that was reasonable and fair. Now going forward, we’ll have to set a new pay policy and that will be a topic for next week’s spending review.’
The Government announced at the 2020 spending review last November that it was ‘pausing’ public sector pay for 2021/22 but there was an exemption for NHS staff.
Public sector pay was frozen by the Coalition Government for two years from 2011/12.
Then from 2013/14 to 2017/18 public sector pay increases were capped at an average of one per cent.
That policy was then lifted in 2017 and from 2018/19 to 2020/21 parts of the public sector received increases above two per cent.
In April 2020 average weekly earnings in the public sector were £647 compared to £567 in the private sector, according to research published by the House of Commons Library.
In April 2020 earnings for the public sector were 2.4 per cent higher than the year before. But pay actually fell in the private sector by 0.6 per cent.
The fall in the private sector was blamed on the coronavirus pandemic which saw private sector industries like hospitality hammered by lockdown.
