Socialist Worker

Public sector pay limits are an attack on our living standards

by Kevin Courtney, NUT national executive (pc)
Issue No. 2093

Make no mistake – the government intends to hold down public sector wages for many years to come. Gordon Brown’s advocacy of three-year pay deals, limited to around 2 percent, gives that message very clearly.

But three years won’t be the end of it. The government is also intent on using the Consumer Price Index (CPI) as the measure for inflation that sets wages – instead of the long established Retail Prices Index (RPI).

The CPI is calculated using a different basket of goods from the RPI – it doesn’t include housing costs for example.

It also uses a different methodology and has a built in assumption that if the price of an object goes up then you’ll buy less of it. This means that, even using the same basket of goods, the CPI will almost always be less than the RPI.

It is disgraceful that the BBC reports that teachers’ proposed pay rise of 2.45 percent is “inflation beating” when the RPI is currently 4.1 percent.

People’s experience of price rises tells them inflation is much higher even than the RPI level – and all forecasts are for further increases this year.

The breathtaking cynicism of the government is shown by the fact that workers paying back student loans are this year paying back at a rate of 4.8 percent, based on the RPI, while getting a pay rise based on the CPI.

If the government gets away with this then all public sector workers face indefinite wage “rises” less than real inflation.

This isn’t about controlling inflation. The reality is that the government wants to bear down on public spending and it thinks attacking the standard of living of public sector workers is more palatable than increasing taxes on businesses or stopping spending on the war.

None of the issues we are fighting about are limited to teachers. Further education lecturers and civil service workers are also in dispute over pay.

The stakes in the NUT pay ballot couldn’t be higher.

If NUT activists can engage members in the campaign and get a good ballot result, followed by exciting marches and demonstrations on the strike day, then we can help inspire action across the public sector.

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Article information

Tue 18 Mar 2008, 19:07 GMT
Issue No. 2093
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