NHS staff, nurses, paramedics, Border Force, DWP workers and more are all going on strike in pay disputes with the government.
The UK has 5.7million public sector workers, and they are all being offered a pay rise well below inflation - currently running at 11.1%.
A first-in-a-century nurses' strike is going ahead this Thursday after their union and Health Secretary Steve Barclay finished last-minute talks without agreement, as he wouldn’t reopen pay.
No further meetings are currently scheduled before Thursday. The Royal College of Nursing general secretary Pat Cullen blasted his “belligerence", adding: "They have closed their books and walked away”.
As industry after industry downs tools, Rishi Sunak has insisted he can’t give all public sector workers a pay rise with inflation.
Chancellor Jeremy Hunt warns doing so would “lock in” high inflation - because everyone’s wages went up, prices would continue going up too.
No10 said: “It is unaffordable to match inflation as it currently runs. If we were to do so, we firmly believe that would embed inflation and act against everyone’s interests.”
But the Prime Minister has also warned it would cost “ordinary families” an “extra £1,000 a year”.
This has raised eyebrows among experts, who say the £1,000-per-family figure is not to be trusted.
Institute for Fiscal Studies (IFS) economist Ben Zaranko ported out the flaws in an excellent Twitter thread, tweeting that there are “arguments for/against a higher public sector pay award” but “we shouldn't have it on the basis of dodgy numbers”.
And Lib Dem leader Ed Davey has said: “These disingenuous figures show just how desperate the government is to deflect blame for bringing the country to a standstill.”
So how did Rishi Sunak get to the figure - and why are people calling it out? Here’s the situation explained.
Where does the £1,000 figure come from?
Rishi Sunak said: “What I'm not going to do is ask ordinary families up and down the country to pay an extra £1,000 a year to meet the pay demands of the union bosses.
“That wouldn't be right and it wouldn't be fair."
This is based giving all 5.7million public sector workers an 11% pay rise in 2023/24, which the government says would cost £28billion.
There are 28.1million households in the UK, according to the Office for National Statistics.
That gives an average of almost exactly £1,000 per household.
But it’s not an ‘extra’ £1,000
Downing Street has admitted the £1,000 figure is based on the entire cost of raising pay by 11%.
That means not all of it would be an “extra” cost compared to what we have now.
That’s because public sector workers are already getting some kind of pay rise each year.
In the NHS, for example, this year’s (2022/23) pay rise averages out at about 4.75% (though varies by job title).
And we know there will be some kind of below-inflation pay rise in 2023/24 too.
So really, argue critics, the government should be describing the difference between existing rises and 11% - not the entire cost of 11% from scratch.
The IFS says offering an inflation-matching pay award to public sector workers this year would have added about £18bn, less than the £28bn cited by the government.
And it’s for the ‘wrong’ year
The government is justifying its claim by saying it’s based on an 11% pay rise in 2023/24 - not in 2022/23.
But IFS economist Ben Zaranko tweeted this is “a bit odd” because unions are arguing over their pay rise for 2022/23. So why not look at the cost of doing it this year?
The Office for Budget Responsibility also expects CPI inflation to be 5.5% over the 2023/24 financial year, lower than the figure for this year.
So the government is actually looking at the cost of an above -inflation pay rise next year.
And lots of it would come back in tax
The problem about talking about a pay rise for 5.7million workers in terms of the “cost to taxpayers” is that nearly all of them are taxpayers too.
And of course, when you give workers a pay rise, they will be paying more tax.
Clearly it costs the government more than it gets back to give public sector workers a pay rise. But it can’t pretend that the entire cost of a pay rise disappears, when people pay 20% tax (at least) and 12% National Insurance on earnings above the threshold.
And it’s not £1,000 for each family
The most obvious point is that not every household is a family, not every household is the same, and not every tax rise is the same.
Some very low-earning households pay almost no taxes apart from unavoidable things like VAT on goods.
Some wealthier households pay lots of taxes. So an “average” of £1,000 is pretty meaningless when it comes to measuring what you’d personally pay.
It also depends entirely on how Rishi Sunak would choose to fund a pay rise for public sector workers.
If he chose to hike taxes on higher earners, for example, that would clearly only hit better-off households.
If he put a penny on income tax for everyone, that would affect tens of millions of people. Ditto raising VAT or other taxes indirectly.
