A 1% pay rise would equate to a 0.5% real-terms pay cut for NHS workers.
The Health Secretary has been publically called out for making “incorrect claims” about a pay rise for NHS workers.
Speaking to the Health Select Committee today, Matt Hancock told MPs; “Well, inflation is below 1 per cent, and therefore a proposed 1 per cent pay rise is indeed a pay rise, and that’s simply a matter of fact.”
Adding; “I’m a huge fan of and supporter of the workforce right across the NHS, who’ve done an incredible job during the pandemic. The NHS was carved out of the pay freeze that’s been applied, due to the enormous pressure on the public finances, to everybody else in the public sector.”
Mr. Hancock’s statement comes after the Government claimed a 1% pay rise was all it could afford for healthcare workers.
A real-terms pay cut.
Leading policy and economics specialists have issued a statement correcting Mr. Hancock’s claim.
Dr Gavan Conlon, a partner at London Economics, explained; “Alongside the Budget Statement, the Office for Budget Responsibility March 2021 Economic and Fiscal Outlook presented an estimate for the Consumer Price Index (CPI) in 2020. This was 0.9%. However, more importantly, the OBR also provided their forecasts for CPI between 2021 and 2025.
“In 2021, CPI is forecast to be 1.5%, rising further to between 1.8% and 2.0% between 2022 and 2025.
“When assessing whether the proposed cash pay increase represents a real-terms increase or cut, it is not sensible to compare a proposed cash increase in 2021 with a measure of inflation in 2020.
“Making the relevant comparison, and based on forecasts from the independent Office for Budget Responsibility, the proposed 1% pay increase in cash terms being offered by the Government to the 1 million employees covered by the Agenda for Change Framework in 2021 represents a real terms reduction of 0.5%.”
Incorrect claims.
Anthony Johnson, lead organiser for the grassroots group Nurses United UK, said many are now struggling to take Mr. Hancock’s claims “seriously”.
“In nursing, we can’t just make up things, apparently in politics, anything goes. Incorrect claims, billions in contracts to your mates, it’s pretty clear why nurses were wearing bin bags for PPE.
A Royal College of Nursing spokesman added; “The Government is digging in despite public anger and clear support for NHS staff.
“In the middle of a pandemic, ministers cannot justify giving just £3.50 extra per week to nursing staff.”