Sunak to consider pay freeze for public sector

Chancellor Rishi Sunak has suggested he could impose a public sector pay freeze in his spending review, but insisted the nation will not see a return to austerity.

He is due to announce a multi-billion-pound plan to invest in longterm infrastruc ture projects and fund the fight against the coronavirus pandemic, on Wednesday.

Mr Sunak insisted it is not the time to impose tax hikes “in the fog of enormous economic uncertainty”, but he did not rule out capping the salaries of millions of public sector workers.

Unions have reacted angrily to the prospect and there is a chance of industrial action if the freeze is confirmed, with Labour saying it would be an “absolute kick in the teeth” for frontline workers.

Mr Sunak told Sky’s Sophy R idge On Sunday: “You will not see austerity next week, what you will see is an increase in government spending, on day-to-day public services, quite a significant one coming on the increase we had last year.”

But, while he said that he “cannot comment on future pay p o l i c y ”, Mr Sunak added: “When we launched the spending review I did say to departments that when we think about public pay settlements, I think it would be entirely reasonable to think of those in the context of the wider economic climate.

“I think it would be fair to also think about what is happening with wages, with jobs, with hours , across the e c o n o m y, when we think about what the right thing to do in the public sector is.”

Mr Sunak insists he does have concerns about the need to tackle the soaring scale of borrowing , but said “there’s an appropriate time” to address that.