Spring Statement fails families who need help now - TUC
- Two-thirds of the financial benefit from raising the national insurance personal allowance will go to better-off households
- Average annual wage will fall by £552 this year compared to 2021 under the Chancellor’s plans
- Chancellor should have penalised DP World by withdrawing public contracts
Responding to today’s (Wednesday) spring statement from the Chancellor, which forecasts that wages will fall in value by 2.0% this year, the equivalent to a real terms £552 pay cut, TUC General Secretary Frances O’Grady said:
“In the midst of the biggest wages and bills crisis in living memory, Rishi Sunak’s Spring Statement has failed families who need help now.
“We did not get the urgent help with soaring bills that families need. And the rise in the national insurance threshold will mostly benefit better-off households.
“The Spring Statement small print shows that pay packets are now expected to fall in value by £11 a week this year. After 12 years of Tory government, Britain needs a pay rise. But this Chancellor has no plan to get wages rising and give working people long-term financial security.”
Responding to the Chancellor’s failure to penalise P&O parent company DP World following their sacking of nearly 800 workers with no notice and no consultation last week, Frances added:
“Not only is the Chancellor not standing up for struggling families, he is not standing up to bad bosses. He should have taken all public contracts off DP World, including freeports, and clawed back all funding they received during the pandemic until they reinstate the workers. Bad bosses should know they are not welcome to do business in the UK.”
- TUC spring statement submission: The TUC’s submission to the Treasury, including recommendations on the support needed for working people and their families with soaring bills and to get wages rising, can be found here: https://www.tuc.org.uk/research-analysis/reports/ending-pay-crisis
- Figures for falling wages: The figures above showing the value of average (regular) pay falling by 2.0 %, £552 per year or £11per week are derived from the updated forecasts for average earnings and CPI inflation published by the Office for Budget Responsibility today. The relevant data can be found in Table 1.1 of the Economic and fiscal outlook document.
- Real pay cuts from 2010-2021: The Conservatives have imposed real pay cuts on public sector workers through pay freezes and caps from 2010 to 2021. Looked at over the period since the 2008 financial crisis, real public sector pay to November 2021 is down 1.6% based on CPI inflation. And the latest (December 2021) figures show real pay falling 1.6% in health, 4.6% in education and 4.2% in public administration.
For pay across the whole economy, the party has presided over all but two years of the longest pay squeeze since Napoleonic times (2008-2021), during which average pay across the economy fell in value, leaving workers facing effective pay cuts. At the trough in 2014 real pay was down 7.4% on its previous peak.
- The UK’s exceptional pay squeeze compared to other countries: Last week the TUC published research showing that the UK is one of just 7 out of 33 OECD countries where real wages have fallen between 2007 and 2020. The average wage in the UK would be £76 per week higher if growth had kept pace with the OECD average since the financial crisis. Full details here: https://www.tuc.org.uk/news/uk-workers-miss-out-ps4000-pay-growth-compared-oecd-average-2007-tuc-analysis
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