UK Eyes Inflation-Busting Pay Raise for Teachers and NHS Staff

Rachel Reeves, Britain's new finance minister, is considering inflation-busting pay raises for nearly 2 million government employees to prevent public sector strikes. This includes a recommended 5.5% wage rise for 460,000 teachers and 1.4 million NHS staff. The Labour Party, which recently won a general election, promised a decade of national renewal.

Rachel Reeves, the new UK finance minister, announced her consideration of inflation-busting pay raises for nearly 2 million public sector employees to fend off crippling strikes. Recommendations include a 5.5% wage increase for 460,000 teachers and 1.4 million NHS workers, according to media reports.

Addressing the government's stance on these pay increases, Reeves emphasized the value of public service workers, stressing that prolonged disputes with unions could undermine efforts to enhance public services. 'There is a cost to not settling, a cost of further industrial action, and a cost in terms of the challenge we face recruiting,' Reeves told the BBC.

The Labour Party, which recently secured a significant election victory, has committed to a decade of 'national renewal' following 14 years of Conservative governance. Although Labour ruled out raising key taxes, the estimated 3 billion pound cost of these pay rises necessitates budget adjustments. Reeves affirmed that plans for public sector pay deals and the next budget date would be announced by month's end.

(With inputs from agencies.)