Michael Fallon: Tories must consider ending 1% public sector pay cap

Posted On: 
28th June 2017

The 1% cap on public sector pay could be scrapped to give workers a long-awaited wages boost, Michael Fallon hinted today.

Michael Fallon appeared at a Royal United Services Institute event this morning
PA Images

The Defence Secretary said it was “something we have to consider not just for the army but right across the public sector as a whole”.

The surprise intervention comes as MPs gear up for a crunch vote on the issue in the House of Commons.

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A Labour amendment to the Queen’s Speech calls on the Government to end the annual pay cap in place since 2012 and boost the wages of emergency service workers. 

Mr Fallon was asked this morning whether defence budget increases would include a rise in wages which are being outstripped by inflation.

“That is obviously a huge question,” he told the Royal United Services Institute event in central London.

“It’s partly a matter for the pay review bodies but it also involves a forecast of where you expect inflation to be. I think we expect inflation to start falling back again from the autumn onwards.

And he added: “But it is obviously something we have to consider not just for the army but right across the public sector as a whole.”

It comes after a key policy minister in David Cameron’s government called on Theresa May and Philip Hammond to increase taxes to fund higher spending on public services

Oliver Letwin said the Conservatives should not ditch their timetable for reducing the deficit but had to acknowledge the public was “much more concerned” than in 2010 and 2015 about public spending.

The Conservative MP said schools, hospitals and social care should get priority on any extra money, but added that the time for rethinking the 1% cap on public sector pay rises was “getting close”.

The Labour amendment - which MPs will vote on later today - also urges ministers to recruit more police officers and firefighters in the wake of the Grenfell Tower fire and the recent terrorist attacks.

Leader Jeremy Corbyn said: "Our emergency service workers make us proud at the worst of times for our country, such as the Grenfell Tower fire and the recent terrorist attacks, and deserve the pay rise they have been denied for seven years.

“Conservative cuts have failed. Labour has a different approach, which values those who look after us and will transform Britain for the many not the few.”

Meanwhile, a major survey has found that support for tax rises to fund more public spending is at its highest level since 2004.

Some 48% of the UK public believe the Government should increase taxes to pay for health, education and social benefits, according to the British Social Attitudes survey.