Schools and hospitals could be forced to make cuts if higher pay awards for teachers and NHS staff need to be drawn from already stretched public sector budgets
Keir Starmer is on a collision course with trade unions after the Government ruled out extra cash to fund higher pay rises for millions of teachers and NHS staff.
The independent pay review body representing more than 500,000 teachers in England has reportedly recommended pay hikes of around 4% for 2025/26. And the separate body for over 1.3million NHS workers proposed a salary boost of around 3%, according to The Times.
Both figures are higher than the 2.8% hike proposed by ministers last year. On Monday, No10 said: “There will be no additional funding for pay if recommended awards exceed what departments can afford.”
Schools and hospitals could be forced to make cuts if higher pay awards need to come from already public sector budgets. The move also raised fears of fresh strike action as several unions have said they will not accept resources being taken away from frontline services.
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The National Education Union (NEU), England’s largest teaching union, has already opened the door to a formal ballot over pay. NEU General Secretary Daniel Kebede told the Mirror: “The consequences of not funding a pay award are clear. The recruitment and retention crisis will worsen, and children’s education will suffer.”
He called on the Government to “end the uncertainty”, adding: “No one wants to take strike action but of course as a trade union we do stand ready to act industrially if we need to.”
Jo Galbraith-Marten, from the Royal College of Nursing (RCN), said: “This level of award will do little to turn things around. “Nursing is crucial to delivering the government’s reforms, but the profession is in crisis, with fewer people joining and the numbers quitting skyrocketing.”
She added: “Any pay award must be fully funded, taking resources away from frontline services is unfair on staff and bad for patients.”
Unison’s Helga Pile said: “The NHS needs staff to help it back on its feet and reduce waiting times for patients. With so much at stake, ministers need to show they value the workforce.”
One of Labour’s first acts in Government was to accept the recommendations of the pay review bodies, handing pay hikes of around 5.5% to public sector staff. Junior doctors were also given a 22% pay rise last year to end their industrial action.
The move ended the widespread strikes that rocked the country under the last Tory Government.
Mr Starmer said he hoped to work with NHS staff to avoid industrial action as he visited a health centre in Rossendale, Lancashire. The Prime Minister said: “I don’t want to see strike action, I don’t think anybody wants to see strike action.
“And certainly here we are in a healthcare environment with all the staff working really hard. The last thing they want to do is to go into dispute again. We solved disputes, we are working with the NHS.
“It’s because of the way that we are working with the NHS that we are able to bring waiting lists down and make other announcements today.”
He added: “If you work with the NHS staff, you get better results than the last government, which just went into battle with them. So, we have got our doctors and nurses on the frontline, not the picket line, and I think everybody appreciates that’s a much better way of doing business.”
It comes as Chancellor Rachel Reeves faces a battle to balance the books in the wake of Donald Trump’s damaging global trade war. Economists have warned she may have to hike taxes or cut public spending in the autumn.
A Treasury spokesperson said: “As is part of the usual process we are considering recommendations from the independent Pay Review Bodies and will respond in due course. Last year this government accepted the independent Pay Review Bodies’ recommendations in full, providing the first meaningful real terms pay rises for years.”
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