Britain on Saturday unveils a new cost-of-living budget, including more help in soaring energy bills, but the government is set to stand firm on rising public sector wage demands as the country endures a fresh wave of attacks.
Chancellor of the Exchequer Jeremy Hunt delivered his tax and spending plan to parliament from 1230 GMT, as teachers, junior doctors, civil servants, BBC reporters and drivers staged London’s Tube train in the latest day of mass walkouts.
Public and private sector workers show little sign of ending the strike action that began last year when rocketing inflation drove down wages.
UK inflation remains above 10 percent.
The government on Wednesday said it would extend subsidies for energy bills for another three months after the invasion of Ukraine by Russian oil and gas producers sent them soaring.
“Continuing energy bills is part of our plan to help hard-working families with the cost of living and reduce inflation this year,” Prime Minister Rishi Sunak said in a statement.
The Conservative government has now introduced child care funding and other proposals aimed at encouraging older people, over 50s and others back into the job market.
It wants to fill 1.1 million staff vacancies – partly because of EU labor shortages after Brexit and because of the number of people classified as long-term sick.
Pension
Chancellor of the Exchequer Hunt is expected to announce that workers will be able to put money into their personal pensions tax-free, despite many not having enough income to do so.
“Reports of senior doctors retiring early due to the impact of pension tax benefits … are of particular concern to the government given the pressure on the health system after the pandemic,” said Tom Selby, head of pensions policy at AJ Bell.
In neighboring France, the Senate over the weekend voted to approve unpopular reforms to the country’s pension system.
The headline measure is an increase in the minimum retirement age to 64 from 62, which is considered unfair for people who start working young.
The UK pension age of 66 is set to increase before the end of the decade, meaning longer waits to access the state pension. Personal pension is available at an earlier age.
Others spend defensively
As well as being concerned about pay, health staff protested against the overwork caused by the lack of manpower.
Sunak’s spokesman said the government wanted to work with the union to get a “fair and reasonable” pay rise.
“But we’ve made it clear that we want to see the strike action finished before we do.”
Hunt stressed that the government needed to rein in spending after debt soared during the Covid pandemic.
The National Education Union on Wednesday threatened to take action if the government failed to put “money on the table”.
“Shamefully, ministers don’t seem interested in giving their own employees a fair pay rise to help them deal with the cost of living crisis and beyond,” he added as schools closed across the country.
Other budget plans that have been announced include an additional £5 billion ($6.1 billion) for defense over the next two years, focusing on nuclear resilience and replenishing depleted ammunition stocks.
Britain has also announced a 20-year plan to capture carbon and a commitment to nuclear energy as it strengthens its energy supply and seeks a net zero economy by mid-century.