Improve productivity for higher pay, public sector told

Downing Street has said that public sector workers will only get above inflation pay rises if they improve productivity.

Unions have reacted with anger at proposals for a 2.8% pay rise for teachers, NHS staff and senior civil servants next year.

The British Medical Association (BMA) said there was a “very real risk” of further industrial action if “pay erosion” was not addressed, while Unison’s Helga Pyle said the proposal was a “bitter pill”.

But Downing Street said it was “vital that pay awards are fair for both taxpayers and workers”.

The government said departments will have to finance salary increases in 2025-26 and beyond from their budgets.

Sir Keir Starmer’s spokesman told reporters: “To outpace inflation, pay awards will have to be complemented by productivity improvements.”

Inflation – which measures changes in prices over time – is projected to average 2.6% next year.

The pay recommendations will now be considered by public sector pay review bodies and a final decision will be taken by the government next year.

Asked about strike threats, the Prime Minister’s spokesman said the government “clearly values” public sector workers and that they were given their “first meaningful pay rise” for many years in July.

But, he added, the government was “precise” about the need to take “tough decisions” after inheriting a £22 billion “black hole” in public finances from the previous government.

A spokesman for Sir Keir said the strikes in the NHS were caused by the Conservatives’ “scorched earth approach and failure of leadership”.

But unions say wages are still failing to keep pace with the rising cost of living.

The BMA has said the recommended pay rise for 2025/26 “indicates a poor understanding of the issues unresolved by two years of industrial action”.

Professor Nicola Ranger, general secretary and chief executive of the Royal College of Nursing, described the pay recommendation as “deeply insulting”.

The National Education Union said this fell “far short of the immediate action required”.

Paul Novak, general secretary of the TUC, said: “We all know the strain the mess the Tories have created has placed on the public finances.

“But as the Government’s evidence acknowledges, the recruitment and retention crisis in our public sector is partly driven by pay.”

“It is hard to see how you address the crisis in our services without meaningful pay increases,” he said.

And he called on the government to have “serious talks” with unions and workers about pay and public service reform.

Asked whether ministers planned to meet union general secretaries to discuss pay, Sir Keir’s spokesman said: “There will always be engagement in the pay review body process, and we clearly want the process to be conducted in a collaborative manner.” do. “