Ed Balls: Labour cannot reverse public pay freeze


Shadow Chancellor Ed Balls: ''Pay restraint is going to have to continue''

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Shadow chancellor Ed Balls has indicated Labour will support a pay freeze for public sector workers in order to help reduce the deficit.

Mr Balls told BBC Radio 4's Today programme that getting people into jobs must come before higher pay.

But trade union leaders have accused Labour of failing to speak up for "ordinary people".

The government announced in November that public sector pay would rise by only 1% in the two years to 2015.

When inflation is taken into account, this is likely to amount to a pay cut.

Mr Balls, in a speech to the Fabian Society on Saturday about his economic plans, said he could not make a commitment to reverse any of the government's cuts.

"I understand the anger in the public and private sectors at that income squeeze but the reality is given the economy failing as it is, that that pay restraint is going to have to continue," he told the BBC.


Ed Balls is famous for being the attack dog of the Labour Party. But behind the scenes there's been a discussion about whether his stance on the government's austerity drive has been too rigid.

Polling suggests that Labour needs to do much more to regain the trust of voters by laying out more clearly what the party would do if it got back into power.

In particular, Mr Balls wants to dispel any perception that the party would throw money at every problem. That's why he is now telling shadow ministers that they shouldn't be promising to reverse the government's cuts till more is known about the economic situation in 2015.

Critics on the left have already said that will confuse the opposition's message. But Mr Balls is determined it's the best way to restore credibility with the public.

"And if people expect Labour to say 'we'll just oppose', we can't do that. [It] would be irresponsible because the priority has got to be getting people into jobs rather than people being paid more."

Mr Balls also said that the option of awarding higher pay was not available to any political party.

"It would have been tough on pay for any government. It's going to be tougher because of [George] Osborne's mistakes, but I can't promise to reverse that now."

The BBC's political correspondent Ben Geoghegan says Mr Balls's comments are a clear attempt to counter the accusation that Labour lacks a credible plan for dealing with the deficit and that they've spent too much time defending policies which would involve more public spending.

'A big task'

But Mr Balls's comments are expected to anger many public sector workers and trade unionists.

Start Quote

If Labour doesn't want to be the opposition, then where is the opposition going to come from to this government?”

End Quote Alex Gordon President of the RMT Union

Mark Serwotka, the leader of the Public and Commercial Services union, says his stance is "hugely disappointing" and accused the Labour Party of "emulating the Tories" on many issues.

"Instead of matching them on the cuts they should be articulating a clear alternative and speaking up for public sector workers and ordinary people in society," he said.

The president of the RMT union, Alex Gordon, says Mr Balls's decision to back the public sector pay freeze will cost Labour votes.

"What Ed Balls is announcing is that Labour's given up on opposing those policies," he said.

"I think from the trade unions' point of view, what we're going to be asking is if Labour doesn't want to be the opposition, then where is the opposition going to come from to this government?

"Our members aren't going to stand by and take another two years of this kind of punishment and then turn out at the ballot box in 2014 and meekly vote for a Labour opposition that has supported these punishing cuts."

'Responsible capitalism'

Michael Fallon, the deputy chairman of the Conservative Party, says Labour should now vote in support of coalition plans in the Commons.

"They've got to answer the question of would they actually support what we're doing and why are they still saying that we are cutting too fast when they are not proposing to reverse any of our cuts?" he told BBC Radio 5 live.

In a speech to the Fabian Society in London on Saturday Mr Balls said Labour faces "a big task" to regain economic credibility and win back public trust.

He added that Labour must offer an economic alternative which meets the twin challenges of boosting growth now through temporary tax cuts and investment in jobs and delivering reform over the longer term to build "responsible capitalism".

"The challenge we face is both to set out a radical and credible alternative and to win public trust for that alternative vision," he said.


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  • rate this

    Comment number 868.

    I'm a public sector worker and yes it's hard, I have no job security as I have been unable to get a permanent contract since 2008. I do however accept the pay freeze given that my husband, who works in the private sector, has had three redundancies in the same time period and his wages are now a third of what they were three years ago. We're all in it together.

  • rate this

    Comment number 849.

    I am a Refuse collector for a local authority, i lost £3000 a year due to job evaluation, i will probably end up paying £50 extra a month for my pension. We never recieved the payrise of £500 over 2 year promised by the Tory goverment. People focus on well paid teachers and doctors, but how much more can the lower paid public sector workers take?

  • rate this

    Comment number 669.

    I'm a public sector worker and my pay has already been frozen for 2 years, so this is hardly ground-breaking stuff. I also recently went through a restructuring exercise, in which several colleagues lost their jobs. I think this is justifiable as long as the pain is shared equally - so can we expect pay freezes for bankers etc - and maybe MPs? Or perhaps the number of MPs should be reduced?

  • rate this

    Comment number 446.

    Very glad that Labour have woken up to the problems they have caused. Perhaps this will calm some of the ludicrous Union demands which we cannot afford.
    I am self employed and have suffered a 40% reduction in my income over the past 2 years. I also fund all my own pension. I employ two people who haven't had an increase but still have a job. I have nothing else to give.

  • rate this

    Comment number 356.

    Well union leaders I consider public sector employees as "privileged people". They have guaranteed job, pay, pensions, sick leave, working conditions, extra holidays. When times are good they strike for PAY equality with private sector, when there bad they strike for % PAY increase. If you not happy then resign and try to get a job in the real (private sector) world. Quit bullying the taxpayer!


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