Public Sector Pay Cap

Lord Howell of Guildford Excerpts

Wednesday 5th July 2017 Lords Chamber

[Lord Bates]

I seem to remember that when we were in coalition with the noble Baroness’s party, there was in fact a pay freeze for two years, which was then loosened to a 1% cap. We now want to move forward: there needs to be public sector pay restraint but we want to make sure that, through progression pay and other benefits, public sector work is recognised and rewarded.

[Lord Howell of Guildford (Con)]

Does my noble friend agree that the surest way to higher pay for all, including in the public and the private sectors, must be through higher growth and lower inflation? Is not the quickest way to higher growth efficient and systematic control of all public expenditure programmes and lots of new enterprise and new investment? Is it not time for some new language to explain that simple fact?

[Lord Bates]

My noble friend has explained it rather well. Maintaining a good solid economy is good for the economy. It controls inflation and interest rates, which are at an historic low. It has contributed to the fact that we have record levels of employment and has also enabled us to cut taxes for some of the lowest paid, taking 1.3 million people out of tax altogether.