MINI-BUDGET: Kwasi Kwarteng should boost wages, not slash taxes says TUC

TUC recommendations for @KwasiKwarteng’s #MINI-BUDGET: Ministers should boost wages, not slash taxes

• Union body says government must prioritise lifting workers’ pay over “bungs to big business and City bankers”
• **New TUC analysis** shows real wages are down £100 a month compared to same period last year

The TUC has today (Thursday) called on the Chancellor to bring forward an emergency budget that delivers for “working Britain”.

The TUC says rather than “handing out bungs” to corporations and City bankers the government should:

• Bring forward inflation proof increases in the minimum wage, universal credit and pensions to October to help families through the cost-of-living emergency.
• Get the minimum wage on a path to £15 an hour as soon as possible.
• Give public service staff a real-terms pay rise that at least matches the rising cost of living and begins to restore earnings lost over the last decade.
• Strengthen and extend collective bargaining across the economy, including introducing fair pay agreements to set minimum pay across whole sectors.
• Impose a larger windfall tax on oil and gas companies that that are profiteering from UK families.
• Make sure everyone pays their fair share of taxes by going ahead with increases in corporate tax, and equalising capital gains tax rates with income tax as a first step to fair taxes on wealth.

In a submission to the Treasury, the union body warns the government not to repeat the same mistakes of the “Osborne era” when pay and public services were slashed and huge tax breaks were given to big business.

The TUC says the priority for ministers must be to get wages rising across the economy and to fix the staffing crises plaguing hospitals, social care, education and other frontline services.

Pressure on wages

New analysis from the union federation shows that real wages down are down by over £100 a month compared to this time last year – a number that rises to £190 for public sector workers.

For the typical nurse this means a real-terms pay cut of £1,000 over the next year and a real-terms pay drop of £4,300 since 2010.

Speaking ahead of Friday’s emergency budget, TUC General Secretary Frances O’Grady said:

“Friday’s mini budget is an acid test for this government. Are ministers on the side of working people, or more interested in handing out bungs to big business and City bankers?

“Tax cuts will do nothing to jumpstart the economy and will only line the pockets of the wealthy and companies like Amazon.

“When millions are struggling to make ends meet, the Chancellor should focus on getting wages rising across the economy – not helping out corporations.

“That means a £15 minimum wage as soon as possible, boosting universal credit and fair pay deals for workers across the economy.

“And it means ensuring those who’ve profited from this crisis pay their fair share – with a bigger windfall tax on oil and gas giants like Shell and BP, and new taxes on wealth.”

On the need to avoid repeating the mistakes of the past, Frances added:

“We need a budget the delivers for working Britain – not more continuity conservatism.

“Kwasi Kwarteng mustn’t reheat the failed policies of the Cameron-Osborne government, which slashed pay, workers’ rights and public services.

“This pushed people into debt and locked families into years of declining living standards.

“After the longest wage squeeze in modern history, people can’t afford to tighten their belts any more.”

Notes:

– Wages analysis: The figures above are from TUC analysis of ONS data, based on regular average weekly earnings. Earnings are adjusted for inflation using CPI, June 2022.