New Times,
New Thinking.

  1. Election 2024
  2. UK Politics
12 September 2017

The end of the public sector pay cap doesn’t mean an end to wage cuts

Police and prison officers will still face real-terms cuts as inflation runs above pay. 

By George Eaton

As long anticipated, the government has announced that the public sector pay cap will be abolished from next year. “The government recognised in some parts of the public sector, especially in areas of skill shortage, more flexibility may be required, to deliver word class public services,” a No10 spokesman said (pay rises are presently capped at 1 per cent). But for the current financial year (2017-18), police officers will receive a 2 per cent rise and prison officers a 1.7 per cent rise (teachers and nurses are likely to benefit next year). 

The move represents an unmistakable softening of austerity. Public sector pay was frozen by the coalition government from 2011-13, with rises capped at 1 per cent thereafter. The public sector is also hiring at its fastest pace since 2015, having been cut to its smallest size since 1999. 

The deficit, meanwhile, is forecast to rise from £46bn last year to £58bn this year. And Philip Hammond is expected to announce in his autumn Budget that that the deadline for eliminating the deficit has been extended from 2025 to 2027 (having already been extended from 2022). His predecessor George Osborne had, of course, vowed to eradicate the deficit by 2015. 

But though softened, austerity has not ended. As Labour and the trade unions will be quick to note, inflation is currently running at 2.9 per cent (with the RPI measure at 3.9 per cent), above the pay increases awarded to the police and prison offices. As a result, though the public sector pay cap is over, wage cuts are not.

Select and enter your email address Your weekly guide to the best writing on ideas, politics, books and culture every Saturday. The best way to sign up for The Saturday Read is via The New Statesman's quick and essential guide to the news and politics of the day. The best way to sign up for Morning Call is via
  • Administration / Office
  • Arts and Culture
  • Board Member
  • Business / Corporate Services
  • Client / Customer Services
  • Communications
  • Construction, Works, Engineering
  • Education, Curriculum and Teaching
  • Environment, Conservation and NRM
  • Facility / Grounds Management and Maintenance
  • Finance Management
  • Health - Medical and Nursing Management
  • HR, Training and Organisational Development
  • Information and Communications Technology
  • Information Services, Statistics, Records, Archives
  • Infrastructure Management - Transport, Utilities
  • Legal Officers and Practitioners
  • Librarians and Library Management
  • Management
  • Marketing
  • OH&S, Risk Management
  • Operations Management
  • Planning, Policy, Strategy
  • Printing, Design, Publishing, Web
  • Projects, Programs and Advisors
  • Property, Assets and Fleet Management
  • Public Relations and Media
  • Purchasing and Procurement
  • Quality Management
  • Science and Technical Research and Development
  • Security and Law Enforcement
  • Service Delivery
  • Sport and Recreation
  • Travel, Accommodation, Tourism
  • Wellbeing, Community / Social Services
Visit our privacy Policy for more information about our services, how Progressive Media Investments may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.

Content from our partners
We need an urgent review of UK pensions
The future of private credit
Peatlands are nature's unsung climate warriors