Public sector workers to receive £2 billion pay rise
As one of Theresa May’s final acts in office, the Treasury is to announce a pay rise for hundreds of thousands of public sector workers.
This £2 billion rise will be the biggest increase in public sector pay in six years and will likely come from existing budgets.
The money will be split across a variety of public sector departments with each type of worker receiving a slightly different increase.
Soldiers are set to receive a 2.9 per cent rise, teachers and school staff a 2.75 per cent rise, police officers, dentists and consultants a 2.5 per cent rise and 2 per cent for civil servants.
The Treasury is expected to confirm these figures in a statement on Monday.
In a change from the public sector pay restrictions which were brought in under the coalition government, the workers will receive these raises above the level of inflation.
Public sector pay was frozen in 2010 for two years with the exception of those who were earning below £21,000 a year. Following this, rises were capped at 1 per cent and were not above the level of inflation.
This cap was removed last year when Theresa May announced the end of austerity.
According to the Times, this rise will not apply to other public sector workers including junior civil servants and nurses.
The political correspondent for the BBC, Iain Watson, warned that cuts would need to be made elsewhere if this rise was to come from existing budgets and be above inflation.
Responding to the expected announcement, he said: “That is a big challenge for Theresa May’s successor.
“Will they say the age of austerity is finished and fully fund them? Or will they say cuts will be have to be made virtually as soon as they take office?"
Jonathan Cribb, a senior research economist at the Institute for Fiscal Studies, struck a similar tone, saying: ““These public sector pay rises are higher than last year’s and considerably higher than the 1 per cent for many years before that.
“It is the highest nominal pay increase since the coalition. But these increases are still slower than pay rises that are happening on average in the private sector.
“With the partial exception of schools, there seems to be no new money to fund these pay rises, meaning savings will have to be made elsewhere.”