From me on why the public sector pay cap can – and must – go

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From me on why the public sector pay cap can – and must – go

Hello Plymouth

Since being elected in 2015, I have tried to be as accountable as possible by making myself as available as could be. But with changing behaviours and advancements in technology, there is always room for improvement so I am going to redouble my efforts for this term.

Now, one of the big topics over the last couple of days has been to do with public sector pay restraint and the 1% cap. First and foremost and without equivocation, let me say that I believe we have reached the end of the journey on the public sector 1% pay cap and that it should be removed, so let me explain how I think we go about doing that.

One of the core reasons that the Conservative Party has found itself elected at the last three General Elections has been economic competence. I think between 2010-15, the Conservative Party oversaw an economic recovery that was one of the fastest in Europe and helped people back into work. Policies were wide ranging, but one was public sector pay restraint.

This, at a superficial level, seems a little harsh. Yet the Office for Budget Responsibility estimates that this saved 200,000 jobs. That is 200,000 pay checks going home to put food on the table and pay the bills. It is important in places like Plymouth where we have a higher levels of public sector workers than elsewhere. Ensuring jobs is one part of the equation and I think we have done that. Just last week I had one constituent from the Navy tell me that in 2007 there were concerns in the dockyard about work drying up and jobs going, but now those concerns have disappeared. However, having saved jobs and ensured livelihoods, promoting fair and proper remuneration is the next step.

Linking back to the economic competence I mentioned earlier, while I believe the pay cap should go, I think it should be done in a considered way that makes sure it is sustainable in the long term. A 1% pay rise across the public sector will cost about £2bn and the Institute for Fiscal Studies estimates a pay rise linked to inflation will cost £4.1bn annually by 2019-20. Importantly, I am not ruling anything out, though we have to make sure it is accounted for and that we as a country are able to pay for it. High levels of public spending, debt and poor regulation of financial institutions left us badly exposed to a global economic downturn in 2008. The Conservative Party has worked hard to deal with those issues and we cannot see that undone, which is why I am petitioning the Prime Minister to raise the pay cap, but as part of a fiscally sound Budget later in the year. The amendment put forward by the Labour Party last night talked of regret

I will be going over to Number 10 later today to talk about this issue and I have also written to the Prime Minister with you can read here.

Please, be under no illusion. I want to see this pay cap gone and I am confident we can achieve this, yet it has to be done in a sustainable way that does not endanger jobs or the economy. A superficial pay rise coupled with job losses is not the way you look after the country and its people.

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