U.K.’s Sunak Urges Company Executives To Embrace Pay Restraint
Prime Minister Rishi Sunak urged U.K. executives to rein in excessive pay awards as he seeks to keep a lid on double-digit inflation.
(Bloomberg) -- Prime Minister Rishi Sunak urged UK executives to rein in excessive pay awards as he seeks to keep a lid on double-digit inflation.
Sunak also sought to defend below-inflation pay settlements awarded to nurses and other National Health Service staff, saying the government had followed in full the advice of independent pay review bodies. The Royal College of Nursing’s demand for a 17% hike is “unaffordable,” he said. Asked about a rise this year in City bonuses, Sunak said that he wants the country to avoid a situation where rising wages fuel further inflation.
“Of course I would say to executives to embrace pay restraint at a time like this and make sure they are also looking after all their workers,” Sunak said in an ITV interview in Bali, Indonesia, where he’s attending the G-20 summit. “It’s about what’s right for the country because if we do end up in a wage-price spiral the people who are going to suffer the most are the people on the lowest incomes and we’ll still be having this conversation in a year’s time.”
The premier -- in office for just three weeks -- is trying to strike a balance between controlling inflation -- currently at more than 10% -- and avoiding worker unrest, as increasing numbers of public sector workers plan strikes over pay deals that represent real-term reductions in wages.
“Ultimately this money is coming from taxpayers,” Sunak said when asked about public-sector pay. “Everyone watching will also know that they’re suffering rising bills, they’ll be having those conversations with their own employers about what’s affordable in these difficult circumstances.”
Sunak’s remarks were later buttressed by Chancellor of the Exchequer Jeremy Hunt, who told the House of Commons on Tuesday that “if we give inflation-busting pay awards to people who may deserve them and may be working extremely hard, that would just fuel further inflation.”
Hunt on Thursday is set to deliver an Autumn Statement -- a budget in all but name -- laying out what he’s previously described as a set of “eye-watering” decisions to raise taxes and curtail spending. On Tuesday, he said “we’re going to be asking everyone to contribute more. But we’ll be asking people who have more to contribute even more.”
Hunt also said government support on energy bills is currently worth about £700 ($834) a year for the typical household, and that it won’t end in April. He said he’ll lay out further details on Thursday.
Sunak’s predecessor, Liz Truss, had originally announced two years of government help for all households, before being forced to wind it back to six months amid concerns about how much it would cost. Hunt and Sunak have repeatedly signaled they’ll prioritize the most vulnerable Britons.
Asked whether he would encourage households to control their heating use by adjusting their thermostats this winter, Sunak told GB News: “People are going to make their own decisions.
“Ultimately, what’s the thing that people are struggling with most at the moment, it’s high bills, right?” said Sunak. “So if there are things that we can do all of us to improve the efficiency with which we use energy, to be careful about it, I’m sure that’s what people are doing everywhere.”
--With assistance from and .
(Updates with comments from Hunt, Sunak, starting in sixth paragraph)
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