Britain’s new Finance Minister Rachel Reeves has indicated the possibility of above-inflation pay rises for nearly 2 million government employees, including teachers and NHS staff.
This move could be an attempt to avoid crippling public sector strikes, which have been a major issue in recent years.
Two pay review bodies have recommended a 5.5% wage rise for teachers and NHS staff, which could cost the government an estimated £3 billion. Reeves expressed her appreciation for public service workers and highlighted the costs associated with industrial action.
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While acknowledging the potential financial implications, Reeves stated that the government will “make sure the sums add up.” Possible funding options include tax increases, increased borrowing, or cuts to other government spending.
Reeves plans to announce details of public sector pay deals and the date of the next budget before the end of July. The Labour government appears willing to consider significant pay increases for public sector workers to address concerns over staff shortages and strike action.