UNITED KINGDOM: British Prime Minister Rishi Sunak on Thursday sought to put a stop to months of debilitating public sector strikes by giving teachers, doctors, and other workers salary raises of 6% and above, but he cautioned it would cost billions and would force budget cuts elsewhere.
The leader of the Conservative Party stated that he has accepted the recommendations of independent pay review boards about wage increases for public sector employees, emphasising that it was a last offer meant to put an end to months of strike action.
“This is a significant pay award; it’s one of the most significant we’ve had in decades, and it is costing billions of pounds more than the government had budgeted for, and that has consequences,” said Sunak.
“Today’s offer is final. We will not negotiate again on this year’s settlements, and no amount of strikes will change our decision,” he added.
Education unions immediately stated that they would cancel their scheduled strikes and advise accepting the agreement.
The wage rises are intended to close the gap after the nation had its worst period of industrial unrest in more than 30 years, despite being below Britain’s current 8.7% inflation rate.
Junior doctors will now receive a lump-sum salary increase of 1,250 pounds ($1,635) and a 6% wage increase, while teachers will receive a 6.5% pay increase. Similar payments will be given to the police and the military.
The administration is having a difficult time balancing the need to cease strikes with rising public debt levels after more than a year of increased inflation, which at its highest point reached more than 11%.
There isn’t much opportunity for increasing wage expenditure without raising taxes, eliminating other public services, or failing to meet its own borrowing reduction goals.
Sunak stated that because there would be no additional borrowing or expenditure to pay for the compensation hikes, the inflation rate would not increase. The department’s money would be redirected in order to pay for teacher compensation increases.
When explaining how he would pay for the increased salaries, Sunak stated that the cost of obtaining a visa to visit Britain as well as the charge paid by foreign workers to utilise the nation’s publicly funded healthcare system would go up.
Trade unions, who have said that public sector service budgets, such as those for hospitals, are already at a minimum, are expected to rigorously examine other sources of fresh financing.
Sharon Graham, general secretary of the Unite union, said, “The government is putting its departments between a rock and a hard place. They now have to choose between paying workers a half-decent salary or cutting services in already underfunded public services.”
Sunak’s announcement was criticised as a public relations ploy by the Hospital Consultants and Specialists Association, a smaller organisation that represents doctors, who also expressed uncertainty that strikes would stop very soon.
Sunak, who faces an election next year and is badly behind in surveys, has pledged to halve inflation, and ministers have emphasised the concern that raising wages too much would undermine that goal and potentially entrench growing prices.
The Bank of England, however, has concentrated more on private sector pay because it has increased more quickly than public sector pay and because it has a more direct impact on the costs of goods and services that are used to calculate consumer price inflation.
The world’s major, wealthy economies all had lower inflation rates than Britain, which had the highest in May at 8.7%. The overall debt of Britain is a little over 100% of GDP, which is somewhat less than the average of advanced economies.
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