Public sector pay squeeze has cost Dorset £498 million

The public sector pay cap has reduced spending power in Dorset (including Bournemouth and Poole) by £104 million this year according to new analysis published by the TUC today (Tuesday).

Since the pay caps began in 2010, public sector workers in Dorset have had £498 million less to spend in the local economy.

The South West economy has lost £3.9 billion since 2010, £812 million this year alone.

The analysis shows that public sector workers are earning, on average, over £2,479 less today than if their pay had risen in line with inflation (CPI). 

Recent TUC polling shows that one in seven (15%) public sector workers skipped meals this year to make ends meet. One in four (24%) say they couldn’t pay an unexpected bill of £500.

Research published by the IPPR last week revealed that raising public sector pay would boost spending in local economies. And it would help the public purse by raising tax revenues and reducing the cost of in-work benefits.

South West TUC Regional Secretary Nigel Costley said:

“The public sector pay squeeze has driven up in-work poverty. That means less money spent on high streets and in local businesses.

“The pay cap is a false economy. The Chancellor must use the Budget to give all public sector workers the pay rise they have earned, and end these artificial pay restrictions.”