Teachers, police officers and civil servants are poised to see salary hikes in Wednesday’s Budget after a cruel freeze on public sector pay.
Chancellor Rishi Sunak has hinted he will end the pay freeze for 2.6 million public sector workers when he delivers the Budget statement and Spending Review in the Commons.
Mr Sunak is also expected to announce an increase to £8.91 minimum wage, with some experts predicting he could go as far as £9.50 an hour to make up for the £20 cut in Universal Credit.
The move would potentially impact on millions of Brits earning the lowest wages – but Labour has demanded the Chancellor go further to at least £10 an hour.
The Government is under intense pressure to ease the strain on hard-pressed families amid a cost of living crisis intensified by soaring inflation.
Public sector pay rises were put on hold in 2021/22 for all staff except for the NHS and workers who earn less than £24,000.
And soaring inflation means that even a 2% or 3% rise in public sector wages would likely amount to a real-terms cut in pay.
The Sun reported that the freeze would be lifted alongside changes to the minimum wage, which could impact almost 5 million workers.
Asked if he planned to increase the public sector wage bill, Mr Sunak told the BBC’s Andrew Marr Show: “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 Chancellor is also expected to set out changes to the national minimum wage when he stands up in the Commons on Wednesday.
Rates are decided based on advice from the Low Pay Commission, which is due to come forward with its recommendations ahead of the Budget.
The move could impact on millions of low paid workers, but there are said to be concerns in the Treasury about the impact on small businesses.
However Mr Sunak dismissed calls from Marcus Rashford to extend free school meals into the school holidays for the next three years.
The Manchester United forward has already shamed the Government into u-turns over feeding needy children during the holidays.
In a letter to the Sunday Times, Rashford joined with supermarket bosses and food industry leaders to warn that failing to do so would “both deepen and extend the scarring caused by the pandemic on our youngest citizens and ultimately our economy”.
Mr Sunak said: “So we put in place some measures to help families during coronavirus, that was the right thing to do, and in common with the other things that have now come to an end, whether it was furlough or other things, that’s right that we’ve transitioned to a more normal way of doing things.
“But we have replaced… but we have actually already acted, is what I’d say to Marcus and everyone else. We’ve put in place something called the holiday activities program, which provides not just meals but also activities for children during holiday periods for those families that need extra help.
“That is a new programme, it was announced earlier this year, it’s being rolled out across the country, and I think that can make an enormous difference to people.”Internet Explorer Channel Network