Millions of public sector workers to get pay rises of up to 6.5%
The money will come from increasing charges for visas and how much migrants pay to access the NHS
Last updated 13th Jul 2023
Public sector workers including teachers, junior doctors and police workers are going to be given pay rises of up to 6.5% as Prime Minister Rishi Sunak accepted recommendations from the pay review bodies
The Government ruled out extra borrowing to help departments meet the cost.
Rishi Sunak told a press conference in Downing Street: “Those (pay review) bodies have considered a range of evidence about where to set this year’s pay. And their recommendations to Government are for public sector pay rises to go up by a significant amount.
“Now clearly, this will cost all of you as taxpayers more than we had budgeted for.
“That’s why the decision has been difficult, and why it has taken time to decide the right course of action.
“I can confirm today that we are accepting the headline recommendations of the pay review bodies in full, but we will not fund them by borrowing more or increasing your taxes.”
Where is the money coming from?
The Prime Minister told the press conference: “What we have done are two things to find this money.
“The first is we’re going to increase the charges that we have for migrants who are coming to this country when they apply for visas.
“And indeed, something called the immigration health surcharge, which is the levy that they pay to access the NHS.
“So all of those fees are going to go up and that will raise over a billion pounds.”
This offer is 'final'
Rishi Sunak offered a warning to trade unions and workers still involved in strikes and industrial action.
He told a Downing Street press conference that the new pay offer is “final”.
“Now there’s a clear message here. There are always choices. Budgets are not infinite. When some ask for higher pay, that will always create pressures elsewhere,” he said.
“It is now clear momentum across our public services is shifting. The vast majority who just want to get on with their life’s calling of serving others are now returning to work.
“Today’s offer is final. There will be no more talks on pay. We will not negotiate again on this year’s settlements and no amount of strikes will change our decision.”
He said the accepted recommendations were a “fair deal for the British taxpayer”.
'Difficult but responsible' decisions
Chancellor Jeremy Hunt said the Government would take “difficult but responsible” decisions on the nation’s finances and public sector pay in order to manage debt and curb inflation.
The current level of CPI inflation is running at 8.7% and Mr Sunak – who has promised to cut it to around 5.3% by the end of the year – wants to avoid pay increases which could fuel a wage-price spiral.
Mr Hunt told MPs on Thursday that “it is important to deliver on the Prime Minister’s priority to get debt falling and to control borrowing to avoid adding inflationary pressures and risk prolonging higher inflation”.
“That means taking difficult but responsible decisions on the public finances, including public sector pay, because more borrowing is itself inflationary.”
The wider economic challenge facing the Chancellor and Prime Minister was illustrated by official figures showing the UK economy contracted by 0.1% in May.
The 6% award for junior doctors came as medics joined picket lines across England.
Disruption to thousands of planned appointments is expected as junior doctors in England on Thursday started their longest walkout yet in the pay dispute.
The strike started at 7am and ends at the same time on Tuesday.
What has the BMA think of the pay rise?
BMA chairman of council, Professor Phil Banfield said: “This offer is exactly why so many doctors are feeling they have no option but to take industrial action as they have suffered years of below-inflation pay awards and once again the Government and the DDRB have both failed to address that in this year’s uplift.
“Today’s announcement represents yet another pay cut in real terms and serves only to increase the losses faced by doctors after more than a decade’s worth of sub-inflation pay awards. It completely ignores the BMA’s calls to value doctors for their expertise by full pay restoration to 2008/2009 levels.
“With an NHS in crisis, seven and a half million patients on waiting lists, chronic underfunding and doctors being directly targeted with offers of work in Australia, this Government should not be supporting pay uplifts which don’t reverse years of sub inflation pay awards.
“The BMA will continue to fight for the full restoration of pay lost since 2008, and reform of the pay review bodies.”