Below inflation pay rises are a wage cut

Sharon Graham says below inflation rises are a wage cut with workers paying the price of the pandemic.

Unite’s general secretary Sharon Graham says the union will continue to base claims on the RPI figure rather than CPI because it better reflects the actual price rise experienced by Unite members.

Speaking on this week’s rising inflation figures, Sharon Graham said, “This week’s figures mean our members must fight for wage rises above the current rate of inflation, as measured by the RPI. Otherwise, they will be facing a calamitous drop in their standard of living. Current estimates suggest that costs for the typical UK family will jump by £1,700 in 2022. Workers did not create this cost-of-living crisis so why should they pay for it?”

On calls for restraint on wage demands to avoid rising inflation Sharon Graham added, “Today’s inflation figures are a reflection of rising fuel and energy costs and shortages – and that means higher bills for food, fuel and everyday items.

“Predictably the Bank of England has said workers must show pay restraint,” Graham continued. “Tell that to the CEO of Nat West, for example – last year her wages went up by a staggering 85 per cent to £2.6 million. There’s no restraint in the boardrooms, where it’s one wage rise for them and another for us.”

Sharon Graham challenges the use of the CPI instead of RPI by the Office of National Statistics as potentially “a hidden tax on workers’ wages”. The ONS CPI figure for November is 5.1 per cent, while the ONS RPI figure is 7.1 per cent.

She went on to say, “The RPI, which includes housing costs, is a far more accurate measure of the real cost of living than the CPI, which is always lower. Employers favour the CPI in cost calculations because it saves them money, but the truth is that this is a hidden tax on workers’ wages. Unite will always seek wage settlements that reflect the true cost of living because anything else is a wage cut.”

With the government determined to abandon RPI altogether by the end of the decade for the lesser measure of CPI, Unite is working with economists to develop the Unite Bargaining Index. The Unite BI, which will track all real living costs, will be the union’s benchmark measure in all wage and pension negotiations.

In her first 100 days in office as Unite general secretary, Sharon Graham has led the union to deliver pay rises totaling £25 million, with many well above inflation.

By Ryan Fletcher