Ministers knew their public sector pay cap would push children into poverty

George Osborne extended the pay cap after 2015 despite civil service warning that the policy would ‘have a negative impact on family relationships.’

Conservative Ministers approved extending the public sector pay cap beyond 2015 despite a warning the policy would harm family life and force children into poverty.

The previously undisclosed warning is contained in a Ministerial Decision Record obtained by GMB through the Freedom of Information Act.

George Osborne announced in July 2015 that the 1 per cent public sector pay cap would be extended for four years – a policy that had not been included in the Conservative manifesto. The cap remained in force until the 2018/19 pay round.

Civil service advice, contained within the policy decision paper which was signed off by Ministers, stated that:

·         ‘As a result of this policy, public sector workers’ take home pay is not likely to keep pace with inflation.’

·         Extending the cap ‘could increase financial pressure on families of public sector workers which may have a negative impact on family relationships’

·         ‘This policy will make it more difficult for low-income families with children to access essential goods, and will therefore make it harder for the Government to hit the Child Poverty Act targets.’

The policy directly affected over a million families with children. There are an estimated 2.4 million dependent children in households in which there is at least one public sector worker in the UK.

Ministers also considered freezing public sector pay at 0 per cent for two years, the paper reveals.

The Treasury released the paper to GMB after a prolonged delay and being instructed to respond to the GMB by the Information Commissioner.

It was reported this week that Chancellor Philip Hammond – Osborne’s successor – is considering imposing regional public sector pay rates. Similar proposals were defeated in the 2010 to 2015 Parliament. [2]

Rehana Azam, GMB National Secretary, said: “The public sector pay pinch has had a devastating impact on our members for many years.

“GMB now wants pay justice for public sector workers – not yet more cuts.

“Public sector workers have been forced to leave their homes, use foodbanks and many of our members are unable to fund basic necessities for their children such as an annual holiday.

“This damning document is a mark of shame on ministers who imposed years of real-terms pay cuts in the full knowledge that it would condemn families and children to poverty.

“We will fight tooth and nail against all attempts to impose harsh real-terms cuts on our members just because of the region they live in.

“If Theresa May is serious about ending ‘burning injustices’, she must use this Budget to reverse the fall in living standards that this Government has imposed on ordinary working people.”

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