To wonder where all the money is going to come from to increase wages?

[girlfriend44]

Genuine question. Re people who are striking for more money.

Where do they think the extra money is going to come from to increase all their wages and how will this keep inflation down?
Can the government really afford to pay everyone more?

The idea that public sector pay can be funded by cutting MPs wages and expenses is as imbecilic as suggesting people wouldn't struggle if they cancelled Netflix or stopped buying a coffee each day.

Public sector pay costs around £235bn/year - central gov £165bn, local gov £70bn. The NHS wage bill alone is around £60bn. A 10% pay rise across the sector would cost £23.5bn, and as the government would recover approx 32% through income tax and NI, the extra cost would be around £16bn every year.

Labour want to eliminate all non-dom tax rules - and estimates this would provide up to £3bn/year (other sources estimates are lower) so that isn't going to pay for it. Their other big idea is to massively increase the energy windfall tax, but this would be spent on energy subsidies for consumers and industry, and would disappear if and when energy prices come down, so that isn't going to fund the pay rises either.

That leaves the old favourites of a massive rise in taxes (income tax, NI and VAT account for two thirds of all taxes) and/or big cuts in spending and/or a big increase in borrowing - adding to the £50bn/year interest bill already forecast for the next few years, and that's £50bn/year we will be spending for which we get sweet FA irrespective of which party forms the next government.

But by the logic that public service jobs are easier they should be the first to be filled in an economy with a worker shortage.

Do you think public sector workers don’t pay taxes?

I don’t think higher taxes are the answer, people are mobile and we have an economy that relies on being attractive wrt taxes

I think they are if you want good public services which I do.

They’re not low in any case but mid level and we should stick to that

And how do we fund the NHS & social care with an ageing population?

@TeaKlaxon what do you mean?

I haven't said public sector jobs are easier...

The original claim was that public sector workers have it much better than private sector workers.

If that were true, workers would want to fill public sector roles before they look to the private sector. But that’s not happening.

In addition to the many elements already covered, one simple way I had it explained to me was to imagine the life cycle of a pound.

It is not like an chocolate bar which, once eaten, is gone.

Money - which is paid to someone who will spend it - circulates.

Let's say, for example:

• I am paid well enough to have an extra £100 at the end of the term, so I book my daughter into ballet lessons.
• So the ballet school gets the £100 and that of other better paid people
• The combined ballet fees mean the ballet teacher has an extra £100 at the end of the term, so she might go out to dinner.
• More people going out to dinner means the restaurant buys more from the local butcher and hires an extra waiter.

That waiter can now come off benefits and all the people in the story pay more tax.

(Money doesn't circulate nearly so well in an off shore account though - which is why paying your workers can be a smart thing to do if you want vibrant local services).

This is bollox sorry.

When Labour left office the economy was still about a third bigger in real terms than they found it in 1997. That is not ‘nothing left’.

By contrast the Tories have had the economy essentially flatlining over the last 13 years in real terms.

Where do they think the extra money is going to come from to increase all their wages and how will this keep inflation down?

Or to put it another way where has all the money gone? Where is it? Why are so many of the resources owned by so few people?

If anyone's interested, the IFS have produced a number of charts showing actual wage growth/decline in real terms for striking workers. Interesting read. Poor old University lecturers are the worst off, at 19%, but you sadly never hear about them, as it's only those in HE who suffer. Train drivers are well ahead, and surprisingly paramedics are slightly ahead too. The rest are around 10% behind.

@WinnieFosterReads The examples you gave were one-off responses to the pandemic. They are not paid annually, and won't recur in future years.

I think MN tends to underestimate the mobility of the ultra rich. They might like London for the country estates, legal and education systems, but they'd probably choose US healthcare, Milan or Strasbourg for culture, Switzerland for banking/finance. They can and do flit between these places, using private jets. Tell them their global wealth is subject to UK tax, and watch them leave.

Who says there aren’t more applicants for public sector jobs than private sector? It still doesn’t deal with a skill shortage.

Did it decrease in real terms with the crash?

Labour seem very out of touch with how they’ll use all this extra wealth to fund major gaps.

This group is the most mobile and other countries are keen

Well the global elite aren't going to fix our problems.

That's right, but if people earn a decent living wage, they will have more money to spend, which pumps more money into the economy which in turn generates more tax and revenue for the government. They apply this logic to the superwealthy, but never seem as keen to apply it to public sector workers. Go figure...

I think the government just need to make their best and final then hold firm. The railway and Royal Mail are destroying themselves, no one would rely on them now, support for the rest will wither and die the longer it goes on and they'll settle eventually.

It did - but overall across thirteen years it rose in real terms. The rise would have been higher if the crash hadn’t happened but even with the crash the overall impact of 13 years of Labour was an economy that was about 33% bigger.

That meant increases in tax revenue without having to put tax rates up. It meant spending could increase without higher borrowing. That’s what we’ve lost out on under the Tories.

“There isn’t a magic money tree!” Said ex prime minister Theresa May, before finding a magic money tree to join forces with the DUP….

Do you think we’ll go back to 90s growth when Labour get in or it’ll be closer to the economic reality of today?

People look to the comparative short stints of Labour and I get the impression it’s not the global upswing they see - how many other countries had similar boom before the bust?, plus spending we’re paying for now, but some idea that Labour will do the same just because it’s Starmer.

The 70s just before Thatcher got in aren’t mentioned though.

👏 👏👏

Ffs there is PLENTY of money - it's just unfairly distributed!!

Bankers, politicians and many others could all be paid much, much less. Ridiculous amounts of money are spent of things unnecessarily. I wonder how much the queen's funeral cost. The money is there, it's just tied up unfairly with those at the top.

Exactly.
If you want people to do the jobs, you have to make them attractive. Literally everyone on here says they never want to be a teacher or nurse or carer. So what happens then 🤷‍♀️

Well they can start by clawing some of it back from greedy entitled mps claiming tens of thousands to redecorate their offices or heat their stables. What world do we live in when mps are quaffing expensive wine and gourmet foods in parliament, all heavily subsidised, and nurses are surviving on microwaved pasta for a 12 hour shift? Then there's the ppe backhanders, eat out to help out shite, badly handled covid payments, etc. There is money available, but it's not earmarked for the plebs.