Matt Hancock claims 1% for NHS is real terms pay rise despite predicted inflation


Matt Hancock claims the 1% NHS pay proposal is a “real terms pay rise” – despite predictions it will be outstripped by inflation by the time it takes effect.

The Health Secretary told a committee of MPs: “Inflation is below 1%, therefore a proposed 1% rise is indeed a pay rise and that’s simply a matter of fact.”

But the Office for Budget Responsibility (OBR) – who provide the financial predictions on which the Government plans its Budget – predict inflation will have outstripped the proposal before it even takes effect.

The pay proposal won’t even be confirmed until late spring.

And the OBR predict inflation will rise to 1.5% this year – meaning prices will rise by more than NHS pay.

The OBR predict inflation will outstrip NHS pay by the time the raise is introduced
The OBR predict inflation will outstrip NHS pay by the time the raise is introduced

And by next year, the OBR say inflation will be 1.8%.

Grilled on the paltry raise by Jeremy Hunt, chair of the Health Select Committee, the Health Secretary said: “As you know I am a huge fan of and supporter of the workforce right across the NHS who have done an incredible job…during the pandemic, absolutely incredible.

He added: “The NHS was carved out of the pay freeze that’s been applied due to the enormous pressure on the public finances that’s been applied to everyone else in the public sector.

“And we put in place evidence reflecting what is affordable and we of course will study what the pay body says.”

This week Deputy Labour Leader Angela Rayner urged ministers to bring in a “significant real terms” pay increase to help prevent thousands of staff leaving the NHS.

Ms Rayner warned that the pressure on NHS staff would continue even after the pandemic.

“We have an NHS workforce that has literally been in crisis the last 12 months,” she said.

“They’ve really pushed themselves to the limits and it’s not going to stop now.

“Our NHS is going to be working around the clock to deal with the backlog.”

The Labour MP said ministers should agree to a multi-year pay deal for all NHS staff – with no cap on negotiations.

The Royal College of Nursing has called for a 12.5% increase and – unusually – threatened strike action over the issue.

Ms Rayner said the 2.1% budgeted for was a “small amount”, adding: “The honest way of approaching this is not to put a ceiling on it.

“We should go into them with the expectation that there is a significant real terms pay increase for those NHS workers.”

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