Hitting wages of key workers would be ‘worst possible’ blow to economy

Government plans to hold down public-sector pay will cause a £156m blow to the East of England’s economy, a TUC analysis shows today.

A total of £1.3bn will be cut from keyworker pay settlements in England this year, after the chancellor announced the squeeze in November 2020, causing a forecast £1.7bn hit to England’s economy between April 2021 and March 2022.

That will cause an average £2.7m of damage in each East of England constituency, a total of £156m in the region, as tightening public-sector belts lead to less spending on local high streets and economies.

UNISON Eastern regional secretary Tim Roberts branded taking money from the pockets of employees at the heart of the pandemic response as “nothing short of deplorable,” warning it would “deliver the worst possible blow to the Covid-scarred economy.”

He said: “The Prime Minister claims he wants to boost the public sector workforce. Yet hitting wages is going to see more staff leaving not joining, especially in care where pay is at poverty levels.

“Job vacancies have proved devastating to the NHS and care sector. Without an urgent rethink on pay, the government risks losing experienced staff.

“Fair wages for key workers would help protect public services and deliver the required economic boost.”

The TUC is encouraging the chancellor to reconsider his pay freeze and commit to policies that will improve pay and conditions for all key workers, including:

  • Fair pay rises for key workers in the public sector, with a plan to restore wages to their levels before austerity;
  • Guarantee that all outsourced public sector workers get a pay rise so that they earn at least the real Living Wage;
  • Action to ensure that every key worker in every sector gets a pay rise, including raising the national minimum wage to at least £10 per hour;
  • Ban zero-hour contracts and use the long-awaited employment bill to strengthen rights to fair working conditions for key workers.

TUC regional secretary Sam Gurney paid tribute to key workers who have “kept Eastern England going through the pandemic.”

He said: “The Prime Minister clapped them, but his applause will ring hollow if he cuts their pay. It’s no way to thank them.

“We’re all part of the same pay circle. When a key worker spends their wages, it goes into other people’s pay packets. Shop staff, factory workers, delivery drivers, childminders, bar staff – right across the economy, we are all connected.

“If our key workers get the pay rises they’ve earned, it will benefit everyone. The spending boost will help our local businesses and high streets recover quickly. And it will help level up our unequal economy.”

More than 50,000 people have signed a TUC petition urging the government to deliver a pay rise for key workers, please add your name and make the message louder.

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The TUC is campaigning to achieve a pay rise for key workers. If you want to do your bit for you and your colleagues, please join the organising call on Tuesday February 9 at 6pm.

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