The cost of living is higher and the squeeze on earnings is back with a vengeance, but pay in the public sector and most parts of the private sector is still being held at below-inflation levels, as it has been for the best part of a decade. The Tories reacted to near-defeat in the general election in June by shifting their position slightly — increases of just 1 percent became 2 percent for some groups.
But they are under pressure to go further in the next pay round, which will establish increases for 1 April 2018 and beyond. Teachers’ unions have lodged a claim for 5 percent, and in the NHS, health unions have called for a rise equal to inflation, with an extra £800 on pay rates for every individual, to make up for some of the wages lost over the past seven years.
At the moment the government is desperate to hold the line at 2 percent, despite inflation running at nearly 4 percent under the widest measure, the Retail Price Index, and at over 3 percent according to the official Consumer Price Index figure. Indeed there is a risk that the recent pay offer to local government staff in England and Wales, of just 2 percent, could help this figure become a new norm, if it is accepted.
Unions representing council workers have agreed to put the offer to members, even though their original claim was for 5 percent. They have even written to the chancellor requesting that he provides funds to pay the proffered increases, of 2 percent to most, with slightly higher rises for the lower-paid.
The union leaderships are likely to argue that members’ demoralisation over swingeing cuts in jobs and services means that a fight over pay in local government is not possible. But this is not necessarily a foregone conclusion, either in local government or other parts of the public sector.
In the civil service, the PCS recently organised a consultative ballot over pay. The turnout of 49 percent was the highest of any national ballot since the PCS was formed in 2000. Nearly all of those voting, almost 99 percent, said yes to making funds available to provide above-inflation pay rises, and nearly 80 percent voted in favour of taking industrial action over pay.
In the wake of the vote, the PCS is using the analysis of voting results from the pay ballot to ensure that all workplaces are industrial action ballot-ready, so that if they have to move to a statutory strike ballot they can achieve the majority turnout now required under the Trade Union Act, and an even higher yes vote.
They are also talking to the TUC and other unions about joint campaigning on pay. In the NHS and schools, there is every chance that increases could be higher than 2 percent, especially if the unions back up their claims with industrial activity.
Doubtless the newspapers will be full of warnings about a new “winter of discontent”, in the hope that fears of a lack of support will make public sector trade unionists think twice before taking industrial action. But back then, private sector workers were able to strike to win pay rises in defiance of legal, centrally-established pay norms that were much lower than record levels of inflation at the time.
The government of the day was Labour, but was determined to reduce public spending and wages in line with IMF edicts. Public sector workers were initially held back from doing the same as private sector workers by their leaders’ links with Labour, but as inflation went higher it became impossible to hold the line, and a series of defensive strikes took place, aimed at restoring some sort of parity with private sector pay increases.
The situation is different today in many, though not all, ways. But a key danger is that the unions will prioritise “waiting for Labour” over industrial action to force the government to pay up now. This underestimates the Tories’ weakness, and the popularity of key groups of public sector workers, such as nurses and teachers.
Developments in the civil service show that with a pull and a push, industrial action over pay could become a real prospect. And the TUC demonstration on 12 May could be a focus for workers’ aspirations, in the public sector and beyond.
As this government lurches from one disaster to another, pay could become the first line of its epitaph. And the more there is a fight now, the better it will shape a future Corbyn government.
The TUC has announced a march in central London on Saturday 12 May as part of its “Great Jobs Agenda” campaign. Details are few so far, but for updates go to: tuc.org.uk/events/new-deal-working-people-tuc-march-rally