Trade unions have blasted the Bank of England governor for calling for pay restraint, at a time when workers are facing a drop in their real incomes.
Unite general secretary Sharon Graham says employers who can afford to give their staff a pay rise, should do so.
Workers shouldn’t be expected to pay for the energy crisis, or the surge in inflation, she points out, adding that Andrew Bailey is actually calling for a national pay cut.
“Yet again workers are being asked to pay the price, this time for inflation and the energy crisis. Inflation has not been caused by workers. Why should they be expected to pay for the failures of the energy market and the total shambles of Government policy?
“Workers don’t need lectures from the Governor of the Bank of England on exercising pay restraint. Why is it that every time there is a crisis, rich men ask ordinary people to pay for it?
“Enough is enough, we will be demanding that employers who can pay, do pay. Let’s be clear, pay restraint is nothing more than a call for a national pay cut.”
As covered earlier, Bailey insists he’s not saying ‘nobody gets a pay rise’ – but he is urging workers to hold off on asking for bigger pay raises, even though households face the worst squeeze on record this year, with inflation heading over 7% by April.
My colleague Richard Partington reports that Andrew Bailey’s comments have drawn a sharp response from other trade unions too:
Kate Bell, the head of economics at the TUC, said inflation was being driven by rising energy costs, not pay demands.
“Working people need a pay rise now. And the best way to get one is to join a union.
Gary Smith, the general secretary of the GMB trade union, said Bailey’s comments were a “sick joke”.
Bailey was paid £575,538, including pension, in his first year as the Bank’s governor from March 2020, more than 18 times higher than the £31,285 median annual pay for full-time employees in the UK.
Union density in the private sector has fallen steadily since the 1970s, when high rates of inflation were fuelled by high pay settlements, to about 13%. Official figures show average weekly earnings after taking account of inflation fell in November, and remain below their pre-2008 financial crisis peak.
Here’s Richard’s full story: