Anger as Bank of England boss urges workers not to ask for pay rise

Picture CR: PA Wire/PA Images Dan Kitwood

By Alex Daniel

A UK bank boss has caused outrage with union members after telling workers not to ask for a pay rise this year.

Earlier this month, Andrew Bailey, Governor of the Bank of England – advised workers not to ask for a big wage increase this year. His reply has left some unhappy: “We do need to see moderation of wage rises.”

This comes as the consumer price index (the price of a basket of shopping used to determine inflation) reached 5.4 per cent, the highest it’s been since 1992. In simple terms, that means that the cost of goods and services is on the rise and the value of the money in your pocket is down.

Mr Bailey hopes that if wages remain level, then it might slow the meteoric rise in inflation that we’re seeing today, but with bills already high, some critics don’t agree. Many unions are already unhappy with the state of wages leading to strikes such as those performed by the UCU Lecturers Union late last year, but they’re not the only ones.

Jason Hunter, who is a trade union organiser for Unison, said he didn’t agree with the Governor’s statements.

“Wages aren’t causing inflation; they’re responding to them,” he said. “So, people need a pay rise to keep up and it’s really as simple as that.”

According to Jason, a pay rise might be needed ‘probably more than any point in the last 10 years’.

“So [Mr Bailey] needs to be helping to tackle the core causes of this. Like energy prices,” he added.

In fact, Jason – like many union members – refers to a pay freeze or a below-inflation pay rise as a pay cut in reality as they will result in a person’s wage not going as far as it once did.

On the streets of Manchester, local people were equally unreceptive to Mr Bailey’s suggestions, with many saying his suggestion wouldn’t stop them from asking for a pay rise.

“It wouldn’t, in my view,” admits Martin. “I would think of what my needs were and if I felt I deserved one, it would be up to my employer, irrespective of what the Bank of England said.”

“If I felt I were deserving of a pay rise I would ask,” agrees Eleanor.

Alex is also not in favour, emphatically saying: “Absolutely not. This is a guy in a position of authority, thinking he can talk to workers how he wants, but it would not affect my decision-making, ever, when asking for a pay rise.”

It seems then that people are unlikely to heed Mr Bailey’s words, with many we spoke to more likely to ask for a pay rise based on whether they felt they deserved it rather than his warning. But as Jason points out, Mr Bailey’s own words might cause even more people to ask for a pay rise.

“I think they’re more likely to. If they hadn’t thought of doing it then he’s given them the idea.”

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