With the energy price cap up 54 per cent, a tax rise looming and inflation forecast to hit 7.25 per cent in April, the Bank of England announced on 3 February that there would be a 2 per cent fall in incomes this year, the worst since records began in 1990.
This means the British public is facing the biggest squeeze on their incomes in 30 years. It was a dark day for living standards.
So what was the Bank of England governor Andrew Bailey’s solution? Don’t ask for big pay rises, please.
In an extraordinarily tin-eared response to a great question from the BBC’s Faisal Islam explicitly asking whether workers should avoid asking for “too high pay rises” to prevent an inflation spiral, Bailey responded: “Broadly, yes.”
In 2019, it was reported that Bailey took a pay cut from his £510,000 salary job as chief executive of the Financial Conduct Authority to became the next Bank of England governor, on £495,000. But in the year from 1 March 2020, when you include his pension, he was paid £575,538.
Whatever his own pay, however, his remarks were astonishingly out of touch given the struggle families across the UK will face paying their bills in the so-called Spring of Discontent.
His plea has apparently gone down poorly not only in the country but within the Bank’s own comms team. Whether British workers will heed his advice, however, is a question above the Chatterer’s pay grade.