- Live Politics latest news: Give back pension rise cash if you don't need it, suggests Therese Coffey The Telegraph
- Former Tory minister calls 10% rise in state pension ‘ludicrous’ The Guardian
- Pay boost for City bosses will anger public sector workers iNews
- PM's plan to boost City bosses' pay contrasts with demands for 'wage restraint' elsewhere iNews
Give back pension rise cash if you don't need it, suggests Therese Coffey
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| Britons should give back cash from next year's pension rise if they do not believe they need it, Therese Coffey has suggested. |
The Treasury confirmed on Tuesday the pension "triple lock" will be reinstated after it was paused during the pandemic, taking retirees' annual payout beyond £10,000 for the first time as the state pension and benefits rise in line with inflation.
Lord Clarke, the former Chancellor, told the BBC World at One the Government should "protect the poor [and] stop giving me money to pay my power bills".
But Ms Coffey, the Work and Pensions Secretary, said in comments given to the same programme: "Of course there’ll be some people like Lord Clarke who’ve got substantial amounts of money, I’m conscious of that.
"But nevertheless, in order to deliver this payment effectively, it is a comprehensive payment, and frankly I’ll ask Ken Clarke to send a cheque back to HMRC if he feels that strongly against it. This is about helping people in a really challenging situation right now."
And asked if others should give the money back - by either cancelling their Winter Fuel Payments or via a bank transfer to the Treasury - she added: "I am always encouraging people who seem to think that they don't need money given from the Government to (return it)."
5:25pm
That's all for today...
When it comes to this week's rail strikes, the gap between Sir Keir Starmer's shadow cabinet and the Left-wing group of socialist MPs on the backbenches could hardly be wider.
At Wednesday's Prime Minister's Questions, Boris Johnson enjoyed picking apart Sir Keir's relative silence on the issue - amid opposition complaints that the Government could be doing more to stop the strikes.
But Mr Johnson is not out of the woods himself. Tomorrow sees two crucial by-elections - one in a Tory 'Red Wall' seat gained in 2019, the other in a traditional heartland constituency that has always been blue.
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| Has the 'Boris factor' worn off? We will have two indications by Friday morning CREDIT: ANDREW PARSONS/CCHQ/PARSONS MEDIA |
Neither election takes place in favourable circumstances for the Conservative Party, with the former sitting MPs in Wakefield and Tiverton and Honiton both quitting after high-profile scandals.
The outcome of tomorrow's vote, which will be known early on Friday, will prove something of a mid-term referendum on the Johnson premiership - and a test for Sir Keir and Ed Davey as to whether they can capitalise on a torrid few months for the Tories.
My colleague Jack Maidment will be back tomorrow to guide you through the latest developments in Westminster.
5:04pm
Prince Charles’ powerful plea to Rwanda: ‘The genocide must never happen again’
Like many children, four-year-old Ariane Umutoni’s favourite food was cake. Her favourite drink was milk and she loved singing and dancing.
She was killed during the 1994 Rwandan genocide by being stabbed in the eyes and head.
Francine Murengezi Ingabire, 12, loved swimming, eggs and chips. His best friend was his sister, Claudette. He was hacked to death by a machete.
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| The Prince of Wales and the Duchess of Cornwall after laying a wreath at the Kigali Genocide Memorial CREDIT: JONATHAN BRADY/PA WIRE |
The Prince of Wales and the Duchess of Cornwall were visibly moved earlier today as they toured the children’s room at a museum inside the Kigali Genocide Memorial.
Read the full story here as the PM prepares to head to Rwanda
4:38pm
'Lessons have been learned' from Windrush
Lessons have been learned from the Windrush scandal, Michael Gove said today as he spoke at the unveiling of a new monument at London's Waterloo station.
The Levelling Up Secretary echoed comments made by Prince William at the launch of the National Windrush Monument as he said: "Even recently, mistakes were made by the state that have ended the lives of many members of the Windrush community.
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| Michael Gove speaking at Waterloo station earlier today CREDIT: JOHN SIBLEY/REUTERS |
"I want to emphasise how sorry we in Government are for those mistakes. Words can’t make up for the hurt and anguish that were caused but lessons have been learnt. But most importantly today we want to make sure that everyone remembers the word Windrush as a cause for celebration."
Mr Gove said the country had been "immeasurably enhanced" by new Britons who formed part of the Windrush generation.
"Britain called and those early pioneers came and for that answer to that call we should all across this United Kingdom be forever grateful."
4:19pm
Prepare now for Putin to cut off gas supply, Europe warned
Europe has been urged to prepare for a complete cutting off of Russian gas supplies as the continent’s energy crisis deepens, writes James Warrington.
The International Energy Agency warned Putin’s decision to curtail flows through the Nord Stream pipeline over the last week could be a precursor to a full shutdown this winter.
Fatih Birol, head of the IEA, told the Financial Times: “Europe should be ready in case Russian gas is completely cut off.”
He said European countries should take measures to reduce demand ahead of the key winter period. This included firing up old coal-fired power stations despite concerns about emissions.
4:07pm
'Now the strikes remain on'
The RMT rail union has vowed to proceed with tomorrow's train strikes because Grant Shapps, the Transport Secretary, has not allowed Network Rail to withdraw a letter threatening 2,900 redundancies.
"We came back here today seeking for that threat to be removed so that we could negotiate a settlement to the dispute," Eddie Dempsey, the RMT's senior assistant general secretary, told Sky News after another day of talks failed to yield any solution.
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| Mr Dempsey had joined the picket line at Kings Cross on Tuesday CREDIT: GUY SMALLMAN/GETTY IMAGES |
"We have been told now by the highest people in Network Rail they don't have the authority to say they can withdraw that latter. There's only one place that can say that, and it's in the Department for Transport.
"So it's pretty clear the Government have scuppered these talks, so now the strikes remain on and they will commence at one minute past midnight tonight."
4:02pm
Allison Pearson: The NHS is wasting your money – again
When Sajid Javid let it be known that General Sir Gordon Messenger would be conducting a review into leadership in health and social care many of us cheered, writes Allison Pearson.
Hopes were high that this ex-Royal Marine and former vice-chief of the defence staff – who won the DSO not once, but twice, for defeating Saddam Hussein’s forces in Iraq and leading British troops in Afghanistan – would engage NHS managers with all the tender consideration he showed towards the Taliban.
Oh, sweet Montgomery of Alamein, what a letdown!
Instead of delivering a commando’s knife in the ribs, the good general clearly had his guns spiked by the public-sector Blob. The Messenger Review, which should have recommended that a scalpel (on second thoughts, make that a chainsaw) be taken to the monstrous, metastasising bureaucracy that sucks resources away from the life-giving parts of the NHS, landed with all the ferocity of a feather on a futon.
It’s as if the general had been asked to write a report about Chernobyl and failed to mention the nuclear power plant.
Allison Pearson: Why 'our NHS' is a socialist state within a state
3:46pm
A big day ahead for Boris
There is a lot at stake tomorrow for Boris Johnson and the Conservatives tomorrow as the party looks to hold on to a 'Red Wall' gain and a traditional heartlands seat in two by-elections.
Since the seat of Tiverton and Honiton was created in 1997, it has always been held by the Tories by a significant margin.
But this week's vote takes place amid fears Sir Ed Davey's Liberal Democrats are parking their tanks on the lawn of Mr Johnson's party as they seek a third by-election scalp in the space of a year.
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| Boris Johnson joined Helen Turton, the Tory candidate for Wakefield, on the campaign trail earlier this month CREDIT: ANDREW PARSONS/CCHQ / PARSONS MEDIA |
The Conservatives will also be anxious to hold on to Wakefield - one of many 'Red Wall' gains they made in traditional Labour territory at the last general election.
Equally, Labour will need to show they can start winning back the loyalty of scores of northern and working-class Britons who abandoned the party in 2019.Here is the lowdown on the Tiverton and Honiton by-election...
... and all you need to know about the Wakefield contest
3:31pm
Mick Lynch: Grant Shapps has wrecked these negotiations
These comments just in from Mick Lynch, the general secretary of the RMT:
Grant Shapps has wrecked these negotiations by not allowing Network Rail to withdraw their letter threatening redundancy for 2,900 of our members.
Until the Government unshackle Network Rail and the train operating companies, it is not going to be possible for a negotiated settlement to be agreed.
We will continue with our industrial campaign until we get a negotiated settlement that delivers job security and a pay rise for our members that deals with the escalating cost-of-living crisis.
It comes after more failed talks today between the union, rail operators and Network Rail in a bid to break the current stalemate.
RMT members across 13 train operators and at Network Rail will now walk out tomorrow - which the second of three planned strike days - with Britain's railways once again expected to be crippled.
3:29pm
Alistair Darling: Nicola Sturgeon knows she would lose a second referendum
Nicola Sturgeon does not really want to hold a second Scottish independence referendum because she knows she would lose, Alistair Darling has said ahead of her unveiling her route map to separation next week.
The former chancellor, who led the victorious pro-Union Better Together campaign in the 2014 referendum, said the prospect of a hard border between England and a separate Scotland in the EU was a "disaster" for the nationalists' case.
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| Nicola Sturgeon has vowed to press ahead with plans for another separation vote CREDIT: ANDREW MILLIGAN/PA WIRE |
Now Lord Darling of Roulanish, he agreed Ms Sturgeon’s call for another separation vote was "the politics of distraction" from her government’s domestic record and aimed to keep her "own troops going" in the SNP’s rank-and-file membership.
With polls showing a clear majority of Scots oppose her timetable for a referendum next year, he said Ms Sturgeon wanted to avoid the disastrous fate of helping lead the losing campaigns of two independence referendums.
3:14pm
Breaking: Tomorrow's rail strike to go ahead
Tomorrow's rail strike is to go ahead, the RMT union has confirmed as it accused Grant Shapps, the Transport Secretary, of "wrecking" negotiations.
More to follow...
3:10pm
Give back pension cash rise if you do not need it, suggests Therese Coffey
Britons should give back next year's pension rise if they do not believe they need it, the work and pensions secretary has suggested.
Speaking to BBC Radio 4's World at One, Therese Coffey said: "Of course there’ll be some people like Lord Clarke who’ve got substantial amounts of money, I’m conscious of that.
"But nevertheless, in order to deliver this payment effectively, it is a comprehensive payment, and frankly I’ll ask Ken Clarke to send a cheque back to HMRC if he feels that strongly against it. This is about helping people in a really challenging situation right now.
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| Therese Coffey made the comments on Radio 4 CREDIT: ANDY RAIN/EPA-EFE/SHUTTERSTOCK |
On whether others should give the money back, Ms Coffey responded: “I am always encouraging people who seem to think that they don't need money given from the government to (return it).
"There’s a very straightforward way they can return that, and of course other people often give it to other charitable donations as well.”
2:53pm
'Reckless' for public sector pay to rise with inflation, says No 10
It would be "reckless" to raise public sector pay in line with the current levels of inflation, Downing Street has said.
Boris Johnson's official spokesman said he was "not going to jump ahead" when asked by reporters this afternoon why pensions surging next year would not increase inflation.
"We will keep explaining to the public why we think this is the right approach, and we are confident that the public will understand that it would long term have a bigger impact on their take-home pay if we were to take actions - reckless actions - now that could spike inflation.
"It's important to stress that does not mean we do not want to reward public sector workers with a pay rise, we do, it's just we must make sure that we don't do anything that has a knock-on impact which feeds into this global inflationary spiral that there is the potential to see."
2:40pm
Why inflation will only get worse
UK consumer prices rose by 9.1 per cent in the year to May = a fresh 40-year high - amid soaring costs for energy, transport and food.
Inflation is expected to pick up further as the year goes on, hitting double digits in the autumn amid an increase in the energy price cap.
Some price categories are easing, but there are signs that companies are still soaking up inflationary pressures into their margins.
These charts show the dangers ahead
2:36pm
Jacob Rees-Mogg: 'Dead hand' of Protocol must be cast aside
The "dead hand" of the European Union will be cast aside by Liz Truss's Northern Ireland Protocol Bill, Jacob Rees-Mogg has said.
Sammy Wilson, the DUP Chief Whip, said the regulatory freedoms being sought "cannot apply to many aspects of law in Northern Ireland" while it remains under "smothering" legislation.
In response, Mr Rees-Mogg said: "It is fundamental that the benefits of leaving the European Union are for the whole of the United Kingdom, and I am pleased with the Bill that has been introduced by my Right Honourable friend the Foreign Secretary, which I hope will go towards ameliorating the problems which have arisen.
"Our single united country cannot be ruled by the dead hand of the Brussels bureaucracy. We voted to leave as a single nation."
2:30pm
Don't be 'Putin's friend', Tobias Ellwood warns rail strikers
Tobias Ellwood has claimed rail union workers striking this week are "Putin's friends".
The senior Tory MP said the disruption caused by this week's industrial action, the biggest on Britain's rail network for 30 years, is distracting the government from the war in Ukraine, a fact the Russian president will be "enjoying".
"We face huge economic headwinds, yet here we are causing such huge self-harm as the country is brought to a halt," Mr Ellwood told Sky News.
I think Russia must be enjoying this self-inflicted distraction, pleased to see that the one government in Europe that is actually standing up to Putin is completely distracted in this way.
I do hope the unions now call off future planned strikes ... this isn’t just disrupting commuters, including key workers, but students as well and indeed the hospitality sector.
Read the full story here
2:26pm
Rishi has acted on tax - but I'll pass on VAT plea, vows Rees-Mogg
A senior Conservative backbencher has urged Jacob Rees-Mogg to make the most of Britain's Brexit freedoms by cutting VAT.
Sir John Redwood made the appeal in the Commons in response to the minister for Brexit opportunities making his statement on retained EU law.
"It is one of our freedoms and the Chancellor did in his Spring Statement announce some amelioration of VAT," Mr Rees-Mogg said.
"I will ensure my Right Honourable friend’s suggestion is passed on to the Chancellor."
2:21pm
Jacob Rees-Mogg: Remainers do not realise where blame lies
Dominic Penna here, taking you through the rest of today's political news and developments.
Remainers do not realise "where the blame lies" for red tape and bureaucracy, Jacob Rees-Mogg has said. The comments came after Hillary Benn, the MP for Leeds Central who was a prominent advocate of a second Brexit referendum, asked Mr Rees-Mogg what he would do about the "barrel load of red tape cost and bureaucracy that has fallen on British businesses since the beginning of 2021".
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| Jacob Rees-Mogg pictured out and about on the campaign trail in Wakefield last week CREDIT: SWNS |
But, calling Mr Benn 'the high priest of Remain', Mr Rees-Mogg told him he would have to "wait and see" what new legislation would do to address red tape.
"The EU runs a fundamentally anti-competitive closed market which was affecting us, it was making goods and services in this country more expensive because we could not trade freely with the world... That’s what we’re getting out of, that’s the economic opportunity.
"It’s to be free from all of that, that strangles slowly the European economy, to have an economy that can grow globally."
2:12pm
Jacob Rees-Mogg announces EU laws dashboard
The Government will publish a quarterly update on all of the EU laws it has reformed, Jacob Rees-Mogg announced this afternoon.
The Brexit opportunities minister told the House of Commons that the Government wants to "transform the UK into the most sensibly regulated economy in the world" and part of those efforts will include reforming the "EU law we have retained on our statute book".
Mr Rees-Mogg said there will be an interactive online dashboard which will enable people to keep track of any law changes.
He said: “I am pleased to announce that today we publish an authoritative catalogue of over 2,400 pieces of legislation spanning over 300 individual policy areas.
“This catalogue will be available on gov.uk through an interactive dashboard. It will be updated on a quarterly basis so that the public can count down retained EU law as the Government reforms it.”
1:33pm
Labour blames PM for soaring inflation
1:21pm
Labour labels the Bill of Rights 'a con'
Labour has criticised the Government's new Bill of Rights.
Shadow justice minister Ellie Reeves told the Commons: "This is a very dark day for victims of crime, for women, for people in care, for everyone in this country who rely on the state to protect them from harm.
"This is not a Bill of Rights, it is a con."
Ms Reeves said the Government looks to "pick a fight to cover up its own failures and then finds someone else to blame".
1:17pm
Dominic Raab presents Bill of Rights to Parliament
Dominic Raab, the Justice Secretary, is presenting the Government's new Bill of Rights to the House of Commons this afternoon (you can read about what is in the Bill here).
Mr Raab told MPs that the legislation will "restore a healthy dose of common sense” to the justice system.
"Our Bills of Rights will strengthen our proud tradition of freedom, it will demarcate a clearer separation of powers," he said.
“It will ensure greater respect for our democratic institutions and it will better protect the public and restore a healthy dose of common sense to the justice system which is essential for commanding public confidence. Ultimately it will make us freer, it will help keep our streets safer.”
1:13pm
PMQs snap analysis
It was inevitable that Boris Johnson and Sir Keir Starmer would clash over rail strikes at Prime Minister's Questions today.
But it will be the PM who will feel like he got the better of the exchanges.
Sir Keir continues to frame the industrial action as being the fault of the Government after it failed to intervene in talks.
Meanwhile, Mr Johnson maintains that it is not the job of ministers to resolve the dispute, instead blaming the unions for bringing the country to a halt.
Sir Keir has tried to stay away from the question of whether the strikes are right or wrong but the decision by numerous Labour MPs to join the picket line yesterday weakened his position and left him open to attack.
Boris Johnson was quick to try to capitalise and Sir Keir struggled to get the debate back onto his own terms.
12:42pm
PM tells Labour MP to 'get off the picket line'
Kate Osborne, the Labour MP for Jarrow who is also a member of the Labour frontbench, joined union members on the picket line yesterday despite an order from Sir Keir Starmer to stay away.
Ms Osborne asked Boris Johnson at PMQs: "When is he going to stop meaningless soundbites and instead start supporting working people across our country?"
Mr Johnson replied: "If she wants to support the working people of this country can I suggest she gets off the picket line, which is where she has been and has a word with her leader and supports the travelling public of this country who want to see a reduction in their costs of transport which this government is delivering."
12:36pm
'Nobody wants a trade war'
Ian Blackford, the SNP's leader in Westminster, said the UK economy is "lagging behind" on Boris Johnson's watch as he claimed the Government's "disastrous Brexit is driving wages down, pushing inflation up and will make us poorer over the next decade".
Told that the Government's Northern Ireland Protocol plans could trigger a trade war with the EU which could then tip the UK into a recession, Mr Johnson said: "Nobody wants a trade war nor is there any need for one. I'm afraid he is underestimating what this country is currently achieving."
12:32pm
Tories have 'left the UK economy in the doldrums
Ian Blackford, the leader of the SNP in Westminster, pointed to inflation hitting a 40 year high and said after 12 years in power, the Tories have "left the UK economy in the doldrums and pushed millions of people into poverty".
He asked Boris Johnson why the UK is "doing so much worse than our European neighbours".
Mr Johnson dismissed the suggestion and said "we have got a global inflationary problem but this Government has the fiscal firepower to deal with it".
12:28pm
PM and Labour leader clash over armed forces pay
Sir Keir Starmer said that working people are paying more tax under the current Government and "now they are told to take a pay cut".
He said: "He is having meetings about increasing bankers' bonuses but he can't find time for a single meeting to end the strikes crippling the country."
The Labour leader said that armed forces personnel are facing a real terms pay cut on Mr Johnson's watch.
The PM hit back and said: "How absolutely satirical that he should talk about our support for the armed forces when we have increased funding for our armed forces by a record sum since the end of the Cold War and when eight of the shadow frontbench actually want to get rid of our nuclear deterrent."
12:23pm
Labour leader accuses PM of 'blaming everyone else' on strikes
Sir Keir Starmer said of Boris Johnson that "all he is interested in doing is blaming everyone else" on rail strikes.
The Labour leader said the nation is "screaming" at the PM to tell him to "get on with your job".
Mr Johnson said what the Government is "trying to do is cut the cost of transport which is a big part of people's weekly outgoings by reforming our railways".
He said: "That is what we are trying to do but he is standing with the strikers and lifting the cost of transport for everybody. That is the reality."
12:19pm
Keir Starmer tells PM to 'get the trains running'
Sir Keir Starmer said the PM and the Transport Secretary have not held a "single meeting, held a conversation or lifted a finger to stop these strikes".
The Labour leader told the PM to "do his job" and "get the trains running".
Mr Johnson said the Government is doing "everything we can to prevent these strikes" but it is "up to the railway companies to negotiate, that is their job".
He added: "The reason his authority is on the line on this matter is that they take £10 million from the unions. That is the fee that the learned gentleman opposite is receiving for the case he is failing to make."
12:15pm
Boris Johnson labels Labour a 'disgrace' over strikes
Sir Keir Starmer said thousands of families have had their holidays cancelled, many are facing delays in getting their passports renewed and there are now rail strikes.
He said: "If he is genuine about preventing strikes will the Prime Minister tell this House how many meetings he or his transport secretary have had with rail workers this week to actually stop the strikes."
Mr Johnson said: "This is the Government that loves the railways, that invests in the railways, £96 billion we are putting into the integrated railway plan... but what we have got to do is modernise our railways and it is a disgrace when we are planning to make sure that you don't have ticket offices that sell fewer than one ticket ever hour that he yesterday had 25 Labour MPs out on the picket line defying instructions... backing the strikers while we back the strivers."
12:10pm
PM slams Keir Starmer over strikes
Sir Keir Starmer used his first question to attack the Tories over the Wakefield by-election which is due to take place tomorrow.
Boris Johnson hit back as he slammed the Labour leader for failing to speak out about yesterday's rail strikes.
Mr Johnson said: "I have absolutely no doubt that the people of this country and the people of Wakefield, the people of Tiverton and Honiton, would much rather vote for a solid Conservative government over a Labour Party, their enablers and acolytes in the Liberal Democrats, the karma chameleons of British politics, when the leader of the Labour Party hasn't even got the gumption to speak out against the rail strikes that are doing so much damage to the people up and down this country. Unbelievable silence from the leader of the Labour Party."
12:05pm
PMQs now underway
The first question of the session is from Labour MP Chris Elmore who asked Boris Johnson: "Has he ever considered the appointment of his current spouse to a Government post or to any organisation in one of the Royal households? Be honest Prime Minister, yes or no."
Mr Johnson replied: "I know why the party opposite wants to talk about non-existent jobs in the media because they don't want to talk about what is going on in the real world."
12:01pm
Boris Johnson arrives at PMQs
Boris Johnson has just arrived in the House of Commons ahead of Prime Minister's Questions.
The Prime Minister has now taken his seat on the Government frontbench. PMQs should be underway imminently.
11:59am
Busy House of Commons awaits PM
The House of Commons is almost full ahead of PMQs.
There had been a feeling that there could be some gaps in the chamber today because of the rail strikes but that is not the case.
11:57am
Teachers threaten strike if they don't get 'inflation-plus' pay rise
Teachers will ballot to go on strike if they are not given an "inflation-plus pay increase", the general secretary of the National Education Union (NEU) has threatened.
In a letter to Nadhim Zahawi, the Education Secretary, Dr Mary Bousted has said that government "inaction" is causing "real damage to education" as well as to the livelihoods of teachers.
"You must respond to the new economic reality of double-digit inflation and the threat this poses to teacher living standards," her open letter reads.
You can read the full story here.
11:46am
What to expect at PMQs
Two issues are likely to dominate PMQs at noon: Inflation and rail strikes.
Soaring inflation could prove difficult territory for Boris Johnson as the Government's handling of the economy faces ever-growing scrutiny.
But he will be feeling confident on the issue of industrial action and will probably want to point out that Sir Keir Starmer failed to make a single public statement on the issue yesterday.
Interestingly, the opposite is likely to be true for the Labour leader who may feel comfortable on the economy but decidedly less so on the the issue of strikes.
It could make for a potentially disjointed set of exchanges between the two leaders.
11:28am
Rishi Sunak defends pensions increase
Rishi Sunak, the Chancellor, was asked why workers should show pay restraint when the Government is committing to giving pensioners a double-digit rise in their incomes next year.
He said: "I think we are confusing two things because we already know what pensions are going to be for this year and people are speculate on what they might be next year.
"We have a long-standing policy in place. Pension rates are decided in the autumn, we have had the triple lock in place for a long time which protects pensioners because they are among the most vulnerable in our society."
11:10am
Rishi Sunak tries to explain pay/pensions stance
The Government has argued that big public sector pay rises would be inflationary but a double digit increase to the state pension and benefits would not be.
Rishi Sunak, the Chancellor, was asked to explain this during an interview this morning.
He said: “Well, it is right that we reward our hard working public sector workers with a pay rise.
“But that needs to be proportionate and balanced with the need not to make the inflationary pressures worse and also to see what is affordable for the taxpayer.
“The slight difference with pensions is pensions are not an input cost into the cost of producing goods and services we all consume so they don’t add to inflation in the same way.”
11:03am
Rishi Sunak refuses to say if UK is heading for recession
Rishi Sunak, the Chancellor, would not be drawn when he was asked this morning on whether the UK is heading for a recession.
He said: "Forecasters will make their predictions but I am confident that we are providing the right support to the economy at this time to help people ease through some of the challenges they are facing with the rising cost of living and rebuild a stronger economy for the long term.”
10:59am
'Bank of England will act forcefully to combat inflation'
Rishi Sunak was asked this morning if the Bank of England has lost control of inflation.
The Chancellor didn't answer the question directly but said the Bank will act "forcefully" to tackle rising prices.
He said: “I want people to be reassured that we have all the tools we need and the determination to reduce inflation and bring it back down.
“Firstly the Bank of England will act forcefully to combat inflation. Secondly the Government will be responsible with borrowing and debt so we don’t make the situation worse and drives up people’s mortgage rates anymore than they are going to go up. Lastly we are improving the productivity of our economy.”
10:51am
'Ludicrous' to increase pensions by double digits
Lord O'Neill, the former Treasury minister, said the Government's decision to raise pensions by double digits while workers face a real terms wages cut is "ludicrous" and "crazy".
Asked why pensioners are getting such a big increase, the crossbench peer told the BBC: “I have no idea… it seems to me pensioners, given the pressure on fiscal policies and these inequality issues now for the past decade and beyond, the constant protection of pensioners seems ludicrous in itself and in these circumstances particularly crazy.
“I am talking as somebody who is getting on a bit of course.”
10:46am
Bank should put up rates even if it could trigger recession
The Bank of England should continue to raise interest rates to combat inflation even if that action risks triggering a recession, Lord O'Neill has said.
The former Treasury minister and crossbench peer was asked during an interview on BBC Radio 4's Today programme if the Bank should continue to put up rates even if it risks a recession and he said: “Unfortunately given some of the nature of these inflationary issues now, probably yes.”
10:42am
'Far too much group think' in western central banks
Lord O'Neill, a former Treasury minister and economist, said he believes the Bank of England will have no choice but to significantly increase interest rates in the coming months in order to tame inflation.
He also accused western central banks of being guilty of "far too much group think" in recent years.
He told the BBC: “I don’t think the Bank really has any choice. I remember chatting on a past programme with some of your colleagues about this not so long ago, a lot of the problem here is of course coming from the supply shortages of Covid and the dreadful price consequences of the Ukraine invasion.
“But there has been far too much group think in Western central banks for now a number of years and they just persisted with quantitative easing far too long and allowed interest rates to stay at extremely low levels for no clear obvious reason.”
9:56am
'The fundamentals are strong'
Dominic Raab said the UK economy is well-positioned to bounce back from its current problems as he argued the Government must take a "disciplined approach" to stop rampant inflation.
He told the BBC: “The vital statistics, the fundamentals are strong, but we have got to make sure we don’t… inflict extra damage to the economy by not taking a disciplined approach to inflation.”
9:33am
Dominic Raab defends pension increase
The state pension and benefits are set to rise in line with double-digit inflation, despite the Government telling workers to accept a real terms pay cut (you can read the full story here).
Dominic Raab, the Deputy Prime Minister, has defended the approach as he said pensioners are in a "different position" to regular workers and need more support.
He told the BBC Radio 4 Today programme: “Look, it is very important we rally together and try and get through this inflation spike as swiftly as we can.
“I would say two things, one on your specific question, it is not true to say the constant, unyielding or blind support for pensioners, the triple lock was relaxed recently and temporarily.
“But the reason they are in a different position, and our overall objective to answer the narrative point is to protect the most vulnerable, it is because they are particularly vulnerable and are disproportionately affected by the increase in energy costs which we know everyone is facing.”
9:25am
Rail strike disruption continues
Train passengers continue to suffer disruption from the rail strikes this morning after yesterday's industrial action across the country.
Services started later than normal today as trains were delayed leaving depots due to Network Rail (NR) signallers and control room staff who would usually have worked overnight shifts taking part in the strike.
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| Passengers wait at Paddington Station in London, this morning as train services continue to be disrupted following the nationwide strike by members of the Rail, Maritime and Transport union CREDIT: ASHLEE RUGGELS/PA |
Just 60 per cent of trains will run across the day as a whole, and some operators will wind down services slightly earlier than normal ahead of the second day of strikes tomorrow.
The third strike of the week is planned for Saturday. Talks between the unions, Network Rail and train operating companies will resume today in a bid to resolve the bitter dispute over jobs, pay and conditions.
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| Commuters are seen on their bikes this morning at Vauxhall in central London CREDIT: JEREMY SELWYN/SELWYN PICS |
9:18am
Lib Dems accuse Rishi Sunak of ‘sitting on his hands’
Liberal Democrat Treasury Spokesperson Christine Jardine MP said: "Rishi Sunak is standing by while millions of people suffer from eye-watering levels of inflation - he either hasn't got any sense or any heart to not intervene.
"This Chancellor has hiked taxes time and time again, refusing to slash them to help with the cost of living emergency. Even when we know slashing VAT is a sure-fire way to help families while keeping inflation under control.
"Instead, the Chancellor, his Prime Minister and his colleagues continue to sit on their hands while the country suffers, they are not fit for purpose."
9:16am
Labour accuses Tories of ‘mismanagement’ on inflation
Rachel Reeves, the shadow chancellor, said: "Today's rising inflation is another milestone for people watching wages, growth and living standards continue to plummet.
"Though rapid inflation is pushing family finances to the brink, the low wage spiral faced by many in Britain isn’t new.
"Over the last decade, Tory mismanagement of our economy has meant living standards and real wages have failed to grow.
"We need more than sticking plasters to get us back on course - we need a stronger, and more secure economy.
9:10am
Inflation continues to rise
Inflation rose by 9.1 per cent in the 12 months to May this year, according to data published by the Office for National Statistics. That is a slight increase on the nine per cent recorded in April.
Rishi Sunak, the Chancellor, said: “I know that people are worried about the rising cost of living, which is why we have taken targeted action to help families, getting £1,200 to the eight million most vulnerable households.
“We are using all the tools at our disposal to bring inflation down and combat rising prices – we can build a stronger economy through independent monetary policy, responsible fiscal policy which doesn't add to inflationary pressures, and by boosting our long-term productivity and growth."
9:07am
Sir Keir Starmer faces ‘explosion’ if he disciplines Labour frontbenchers
A former adviser to Sir Keir Starmer, the Labour leader, has warned there will be an "explosion" if the party disciplines any frontbenchers who joined picket lines in support of striking rail workers.
Simon Fletcher, who also advised former leaders Jeremy Corbyn and Ed Miliband, said there has been "a lot of simmering resentment and irritation" over the party's current position.
Sir Keir is considering possible disciplinary action after he ordered frontbenchers not to join picket lines outside stations, as the country faces the biggest rail strike in a generation.
You can read the full story here.
9:06am
‘We are on the side of the travelling public’
Labour has said it does not want the rail strikes to happen but it has not criticised the unions, instead opting to blame the Government for failing to intervene in the dispute.
Lucy Powell, the shadow culture secretary, was asked this morning whose side Labour is on in the strikes.
She told the BBC: “We are on the side of the travelling public. I think that is really clear. Obviously we support workers, we support workers in trying to negotiate better pay for themselves and they deserve a fairer pay settlement than is being offered at the moment.
“But the Government want to try and make these strikes about the Labour Party but these strikes sit on the lap of the Government.”
9:04am
Labour frontbencher confirms order to stay away from picket lines
Sir Keir Starmer was defied by four frontbenchers who joined picket lines yesterday despite being ordered not to as he was accused of “hiding” over the rail strikes (you can read the full story here)
Lucy Powell, the shadow culture secretary, has confirmed that Labour frontbenchers were told to stay away from picket lines.
She told the BBC: “Yeah, we were advised not to do that. I wouldn’t have chosen to do that. I am a member of the shadow cabinet, I have influence, I have a role here as a national parliamentarian to take action, to raise issues in parliament and that is my job which we have tried to do.”
Asked if the frontbenchers who defied the order should be disciplined, Ms Powell refused to be drawn. She said: “That is a matter for the whips. But as I say, nobody wants to see these strikes happen.”
9:03am
Government brings forward Bill of Rights
The Government is today bringing forward its long-awaited Bill of Rights which will, among other things, give the UK powers to overrule European judges (you can read the full story here).
Dominic Raab, the Justice Secretary, said the legislation will help crackdown on “elastic interpretations of human rights” in the legal system.
He told Sky News: “We have got a proud tradition of liberty in this country, we want to reinforce the quintessentially UK freedoms, particularly freedom of speech which we have seen whittled away in various ways.
“We think that that is the liberty that guards all the others. At the same time we have seen a lot of elastic interpretations of human rights particularly fuelled by the human rights Act… and we think it is right to have a proper separation of powers.
“The UK Supreme Court should do what it says on the tin and be supreme in the legal interpretations and if the goal posts shift and you will remember the whole context around prisoner voting where we were told we had to give prisoners the vote, I think Parliament should have the last word when it comes to the law of the land."
9:02am
Dominic Raab digs in over dispute with barristers
Barristers have voted to go on strike in a row over legal aid funding. The Criminal Bar Association (CBA), which represents barristers in England and Wales, said several days of court walkouts will begin from next week.
The strike is in protest at a proposed 15 per cent increase in the legal aid budget, which it claims is inadequate. It is demanding a minimum of 25 per cent.
Dominic Raab, the Justice Secretary, said this morning that the strike is “regrettable” but he has no intention of giving ground.
Asked if the Government could meet the request for 25 per cent, he told Sky News: “No, they will get 15 per cent as I have already made clear.”
8:24am
Dominic Raab: Government must 'stand firm' on pay restraint
The Government must "stand firm" on pay restraint in the public sector in order to bring down soaring inflation more quickly, Dominic Raab argued this morning.
The Justice Secretary was asked during an interview on Sky News if he believes there will be a "summer of discontent".
He said: “We have got unemployment at record lows, lowest levels since I was born in 1974, the fundamentals of the economy are strong.
“We do understand all of those pressures on workers, particularly for the next year with inflation high. But if we want to get inflation down quicker we cannot relent… on these demands.
“I always want to avoid conflict if I can but I think we have got to protect the public and the lowest paid and that means not allowing a vicious cycle of higher inflation for longer. That is an argument that we must stand firm on.”
8:19am
Union's cannot be allowed to 'win the argument' on pay
Dominic Raab, the Deputy Prime Minister, has signalled that the Government is ready for a lengthy stand-off with unions over pay rises.
He said the Government "can't allow" unions to "win this argument".
Asked how long the Government is prepared to let strikes go on for, Mr Raab told Sky News: “We can’t allow, I’m afraid, the unions in this very militant way that they’ve proceeded to win this argument because it will only hurt the poorest in our society.”
8:17am
Dominic Raab warns against wage erosion
Dominic Raab, the Deputy Prime Minister, has warned that big public sector pay rises would fuel inflation and erode wages as he argued in favour of pay restraint.
He told Sky News: "If we don’t have those restraints inflation will go higher for longer and that will only undermine the pay packages of workers, particularly the most vulnerable workers, for a longer period of time.
“We are taking the action, we are taking a firm line with, for example, the RMT union precisely because we want to protect this erosion of pay packets by inflation.”
8:15am
Good morning
Good morning and welcome to today's politics live blog.
Soaring inflation and rail strikes are the two main issues of the day in Westminster while the Government is also bringing forward its long-awaited Bill of Rights.
Dominic Raab, the Deputy Prime Minister and Justice Secretary, is on the morning media round for the Government and he has been talking about all three issues.
Let's start the day by looking at what he has said.
Former Tory minister calls 10% rise in state pension ‘ludicrous’
Jim O’Neill scathing about decision to help pensioners while forcing real-terms pay cuts on public sector workers
Jim O’Neill says it is ‘crazy’ to protect pensioner incomes while younger people’s wages are being eroded by the highest inflation rates for 40 years. Photograph: Andy Wong/AFP/Getty ImagesRowena Mason and Richard PartingtonWed 22 Jun 2022 18.18 BST
Government plans to raise the state pension by 10% while forcing real-terms pay cuts on public sector workers have been attacked as “ludicrous” by a former Conservative Treasury minister.
Jim O’Neill, the former Goldman Sachs chief economist who served as a minister under George Osborne, said it was “crazy” to protect pensioner incomes while younger people’s wages were being eroded by the highest inflation rates for 40 years.
Asked why pensions were rising in line with inflation when ministers were urging public sector pay restraint, Lord O’Neill told BBC’s Radio 4’s Today programme: “I have no idea. It seems to me pensioners, given the pressure on fiscal policies and inequalities, the constant protection of pensioners seems ludicrous in itself and in these circumstances particularly crazy.”
With pressure mounting on the government as it faces down rail unions amid the most widespread strikes on the network since the 1980s in a dispute over pay and conditions, Rishi Sunak defended the plan to boost pensions while enforcing pay restraint across the public sector.
The chancellor said that, unlike pay increases, a big rise in pensions income would not stoke inflation across the economy. “It’s right that we reward our hard-working public sector workers with a pay rise, but that needs to be proportionate and balanced with the need not to make the inflationary pressures worse and also to see what’s affordable for the taxpayer.
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“The slight difference with pensions is that pensions are not input costs into the cost of producing goods and services that we all consume, so they don’t add to inflation in the same way.”
However, O’Neill warned the government lacked direction on the economy, while also criticising central bank chiefsfor displaying “groupthink” when it came to the effect of quantitative easing and low interest rates on inflation.
“The government needs, instead of jumping from one policy and seemingly trying to pander to everyone’s whims, to develop a clear and articulate policy framework of which we don’t have one,” he said.
Official figures show the government’s preferred measure of inflation rose to 9.1% in May from 9% a month earlier, hitting the highest rate since February 1982. It comes as the government attempts to face down rail unions amid the most widespread strikes on the railways since the late 1980s in a dispute over pay and conditions.
Boris Johnson has warned workers against asking for bigger pay increases because it could risk a “wage-price spiral” similar to the 1970s, in a marked shift from language used last October when he claimed Britain was on a path to becoming a high-wage economy under his leadership.
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Sunak confirmed last month that the pensions triple lock would be reinstated, while benefits would also rise in line with the rate of inflation, from next spring. Under the triple lock, state pensions are increased in value each year by either the rate of inflation for the previous September, earnings growth for the previous July, or 2.5%, whichever is highest.
Forecasts from the Bank of England suggest inflation as measured by the consumer prices index will probably hit 10% in September, putting pensions and benefits on track to rise by that double-digit amount next spring.
The chancellor committed to reinstating the link with inflation after facing heavy criticism from Tory backbenchers for suspending the triple lock last year, which would have led to an 8% increase in pensions and benefits from April 2022.
The return of the policy was confirmed in parliament on Tuesday by Simon Clarke, the chief secretary to the Treasury. “Next year, the triple lock will apply for the state pension,” he said.
“Subject to the secretary of state’s review, pensions and other benefits will be uprated by this September’s consumer prices index which, on current forecasts, is likely to be significantly higher than the forecast inflation rate for 2023-24.”
However, ministers including Clarke have repeatedly warned that offering public sector workers pay rises close to the rate of inflation would “prolong and intensify” the cost of living crisis.
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O’Neill, a crossbench peer who is now helping with a business policy review for Labour, said the government did not have a “clear and articulate policy framework” for its economic programme.
“I am waiting for them to have a clear framework for their economic policy. The whole levelling up and ‘Northern Powerhouse’ stuff … is going to get lost again in all of this.”
Dominic Raab, the deputy prime minister, defended the government’s actions on public sector pay, saying raising it could lead to a “vicious cycle of inflation”. He said it was right to hold out against higher wages for rail workers, who are striking this week over their pay, saying the government must not give in to “militant unions”.
Defending the decision to raise pensions in line with inflation, he said: “[Pensioners] are particularly vulnerable and they are disproportionately affected by the increase in energy costs which we know everyone is facing.”
Pay boost for City bosses will anger public sector workers
A confidential letter between the PM’s chief of staff and the Chancellor reveals the plan to ‘remove restrictions on director and non-executive director remuneration’With the biggest national rail strike in 30 years starting on Tuesday – and industrial action threatened by teachers, medics, bus drivers, airport staff and barristers – the Government is hardening its stance on pay increases.
Britain’s white-hot inflation is expected to pass 11 per cent in October.
Ministers will not allow public sector pay rises that keep pace.
Notwithstanding the cost, Rishi Sunak worries that chunky pay rises will continue to overheat inflation.
That won’t wash with those public sector workers who are trying to make their household budgets add up.
All of this is a contentious backdrop for today’s cover story.
No 10 has asked ministers to help boost pay for Britain’s leading City executives, i’s Paul Waugh reveals. The rationale is that Boris Johnson’s government needs to show companies some of the “benefits of Brexit” – especially overseas firms who might be attracted to the UK by the idea of bigger pay cheques for directors.
A confidential letter between the PM’s chief of staff and the Chancellor reveals the plan to “remove restrictions on director and non-executive director remuneration”.
Mr Johnson has wanted to tear up City pay rules for a decade. He fought against limits imposed after the 2008 crash because he feared London would lose out to New York.
Fourteen years later, the cause of public anger over City pay is easily forgotten. Of course there is envy, always. Yet there was also outcry at casino-style payments that encouraged finance execs to take big risks with their own firms and the economy.
No 10 will probably decide this is a fight worth having. It dials up the heat in strikes set to continue through summer and autumn.
PM’s plan to boost City bosses’ pay contrasts with demands for ‘wage restraint’ for everyone else
Tory MPs say confusion over “high pay” Britain reflects wider incoherence on Government’s economic plan – or lack of one
June 20, 2022 7:04 pm(Updated 7:05 pm)
Paul Waugh: ‘Drafting proposals that let millionaires get even richer while demanding wage restraint from nurses, bus drivers and rail workers feels like a huge PR disaster’ (Photo: Jason Alden/Bloomberg via Getty Images)With a national train strike looming, the Government’s stance on public sector pay hardened significantly today. Treasury Chief Secretary Simon Clarke warned that “we do need to see restraint in pay bargaining otherwise it will get out of control” and signalled that staff won’t be offered real-terms pay rises.
“People have to recognise, if we’re going to forestall the evil of inflation – inflation destroys savings, it destroys growth, it damages any economy where it gets an endemic grip – then we are going to have to show collective, society-wide responsibility,” Clarke said.
Funnily enough, Clarke’s words were identical to those of Bank of England Governor Andrew Bailey. “We do need to see restraint in pay bargaining otherwise it will get out of control,” Bailey had said in February. His remarks were swiftly branded a “sick joke” by unions, not least because his own salary was nearly £500,000.
The curious thing is that, back then, No 10 joined in the backlash, too. “It’s not something that the Prime Minister is calling for. We obviously want a high-growth economy and we want people’s wages to increase,” the PM’s official spokesman said at the time.
Today, Clarke distanced himself from that spokesman. Indeed, the spokesman distanced himself from himself. In a handbrake turn on whether private firms should pay higher wages, he said: “Simon Clarke set out what the Government needs to take heed of. We are sure private companies will be taking heed of that as well.”
Confused? Well, that’s certainly how Tory MPs feel about their party’s overall economic strategy, or lack of one. Rishi Sunak has given the UK its highest tax burden for decades, yet still insists he’s a “tax cutting Chancellor”. Only last October (in his Tory conference speech), Boris Johnson chided private firms for relying on immigration to keep down wages and effectively urged them to pay more. Now, his Government is saying employers should keep a lid on any rises.
The confusion was laid bare in the PM’s spokesman’s own position today. “The Government wants a high wage, high growth economy,” he said. But then admitted that was more a longer-term “ambition” and right now tackling inflation was the priority. When asked if the No 10 stance amounted to “high wages, just not now”, he replied, “I wouldn’t put a time frame on it, given the variables we are experiencing at the moment, not least war in Europe.”
But I’ve discovered that there is one bit of the economy where the Government is very keen on letting pay go up: City bosses. I’ve been leaked an internal Whitehall letter, written by Johnson’s chief of staff Steve Barclay to Sunak, in which he announces No 10 wants current restrictions on bosses’ pay to be “removed” to show “the benefits of Brexit”.
The confidential letter shows that after intensive talks with Policy Minister Andrew Griffith, the No 10 Policy Unit and Minister for Brexit Opportunities Jacob Rees-Mogg, Barclay made a formal request to Business Secretary Kwasi Kwarteng to change the rules on corporate pay.
Outlining “deregulatory measures to reduce the overall burden on business”, the letter included this eye-catching proposal: “Removing restrictions on director (and specifically NED [non-executive director]) remuneration as suggested by the London Stock Exchange Group to improve London’s attractiveness for listings.”
I understand that among the changes being considered by the Department for Business, Energy and Industrial Strategy are amending the UK corporate governance code to allow non-executive directors – outsiders who oversee pay packages – to own more shares in that company.
Current UK rules – inherited from the EU – also include a cap on bonus pay, set at no more than 100 per cent of fixed pay or double that with explicit shareholder approval. They include “clawback” arrangements in case a firm finds reason to recall any salary, and the power of shareholders to know details of directors’ pay packages, so they can approve them or not.
All the restrictions were introduced by the EU in the wake of the 2008 financial crisis and although the Treasury didn’t particularly like them, they went along with them.
It was clear last August that Sunak could see what a political disaster it would be to tear up the bonus cap in the middle of a cost of living crisis. Treasury insiders stressed then that the issue was not a priority, no active work was being undertaken on the issue and anyway it was all a matter for the Prudential Regulation Authority watchdog.
(There’s also a Brexit irony at work here too. For many in the City, what they really want more than freedoms on banker pay is freedoms on who can and can’t work in the UK on short-term company transfers. More visas for foreign-born staff is their real ask.)
Another problem for the Government is the perception from business at home and abroad that it simply can’t be trusted to stick to any policy for very long.
One senior Tory MP, a former minister, told me: “This is a government whose unreliability on tax is up there with any third world country. We rule out windfall taxes, then we enact them. We say we won’t put up National Insurance or Corporation tax, then we do. Corporate planners plan years ahead, how can they believe this Goverment will do what it says?” The same problem may apply to any moves to ditch corporate pay rules.
A more fundamental difficulty is the confusion over what kind of Brexit Britain the Johnson Government wants. Does it really want to head down the low tax, low regulation model that depicts the City of London as a kind of Singapore-on-Thames? Or does the PM’s idea of a “Brexity Hezza” mean he is a high spending, statist in the mould of Michael Heseltine?
As Mayor of London, Johnson himself bitterly opposed the EU banker bonus cap. Will he now get his way?
In his party conference speech just nine months ago, Johnson boasted: “I am pleased to say that after years of stagnation – more than a decade – wages are going up faster than before the pandemic began.” Unfortunately, this month, real pay fell by 2.2 per cent – the lowest in a decade. To underline how huge banker incomes are, that average figure was turned into a 0.4 per cent increase in pay once bonuses were taken into account.
For a Government demanding wage restraint from nurses, doctors, teachers, bin men, bus drivers and rail workers, it still feels like a potentially massive PR disaster to simultaneously draft proposals that would let rich City types get even richer.
Removing the curbs on corporate pay is described in the Barclay letter as one of the “benefits of Brexit”. And there’s no doubt that some in the Square Mile and Canary Wharf believe that allowing greater freedom on directors’ pay will help London compete with New York or Singapore.
But for the millions who voted for Brexit in part to see their own wages go up, the contrast between their own falling incomes and moves to further boost the latest bankers’ bonanza may well be galling. Increasing City salaries to keep up with Wall Street wasn’t exactly the kind of “levelling up” they were promised in 2019.
Just as “Partygate” gave the lasting impression of a Downing Street that felt Covid laws were for everyone else but itself, letting rip on bosses’ pay risks sending a strong signal that wage restraint is for “little people” too.
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