Fury as Labour may have to RAISE taxes to cover £10billion bill for public sector pay increases

New tax rises on the horizon

Economists have warned that new tax rises might be on the horizon to cover a hefty £10 billion bill for public sector pay rises.

Above-inflation wage bumps recommended

Independent pay review bodies have recommended above-inflation wage bumps for millions of teachers, nurses, and other staff, with suggested 5.5 per cent pay rises for NHS and teaching staff.

Chancellor under pressure

Chancellor Rachel Reeves is facing the challenge of covering the hefty wage bill or potentially dealing with more strikes as unions threaten walkouts.

Worrying financial implications

The wage bill for schools and the NHS alone is estimated to be a staggering £3.5 billion, with the total cost for the entire public sector expected to reach £10 billion.

Tough decisions ahead

Economists have pointed out that the money to cover the pay increases can only come from higher borrowing, increased taxes, or cuts in spending elsewhere.

Union pressure and government response

The National Education Union and other organizations are calling for the government to fund the pay increases, with warnings of strike action if the demands are not met. The government has emphasized the value of public sector workers but noted the challenging fiscal situation ahead.

Political reactions

Political reactions are mixed, with Tory MP Alec Shelbrooke cautioning against inflation increases and Labour's Shadow Treasury Minister Laura Trott holding Labour accountable to their promises, particularly regarding tax increases on working people.