Ed Balls: Labour cannot reverse public pay freeze

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

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.

"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.

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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