A two-year public sector pay freeze from 2011 proposed by chancellor George Osborne in today’s emergency Budget speech is a “declaration of war”, according to trade union Unison.
Dave Prentis, general secretary of Unison, said: “This budget signals that the battle for Britain’s public services has begun with the government declaring war. Public sector workers will be shocked and angry that they are the innocent victims of job cuts and pay freezes.
“Freezing public sector pay when inflation is running at 5.1% and VAT is going up will mean a real cut in living standards for millions of ordinary workers and their families already struggling to pay rising bills.
“Nurses, social workers, midwives, paramedics, police community support officers, housing and environmental officers who provide vital public services are among those who will be hit hardest by the two-year pay freeze. And for local government workers this comes on top of this year’s freeze.”
Pledging to end “the culture of excessive pay” in the public sector, Osborne announced that workers earning more than £21,000 a year will be subject to a two-year pay freeze. This is expected to save £3.3bn a year by 2014-15.
Those earning less than £21,000 a year will receive a flat pay rise of £250 in each of the next two years. Osborne said he recognised the “hard work” of the public sector, but said it must share the burden of reducing the deficit by accepting action on pay and pensions.
Prentis also hit out at Osborne’s announcement of a 25% reduction in departmental budget spending over the next four years.
“This will decimate our public services,” he said. “The Budget will do nothing to restore confidence or kick-start the recovery, but will push local economies into the ground, raising the spectre of breadline Britain.
“Throwing tens of thousands of public sector workers on to the dole will cost the country billions in lost tax revenue as well as pile billions on to the benefits bill.
“The chancellor dreams of a private sector recovery but how can that be on the back of brutal cuts to public services workers? Vital services that the poor, the sick and the vulnerable rely on are in the firing line.”
Osborne also pledged to tackle “the spiralling costs” of public sector pensions, which he said would amount to a £10bn black hole by 2015-16. Former work and pensions secretary John Hutton has been commissioned to complete an interim report on cutting public sector pensions by September, ahead of October’s spending review.
Hutton will complete a final report in time for next year’s Budget in April.