Rishi Sunak struggles to defuse Britain’s ‘winter of discontent’

After one of the worst weeks of industrial unrest in recent British history — with nurses, railway workers and postal staff among those on icy picket lines — Rishi Sunak’s government was hanging tough, warning that big pay rises were “unaffordable” and would fuel inflation.

But as Jack Straw, an adviser to Labour governments during the strife-ridden 1970s and later a cabinet minister, said: “These disputes will be settled. They always are.” The question being asked as Britain contends with a new “winter of discontent” is: who will blink first?

The prime minister told his cabinet on Tuesday that the government had “been fair and reasonable” in its handling of the pay disputes. “There’s a feeling that we have to tough this out,” said one minister.

But there is also a recognition in Sunak’s cabinet that dealing with the pay demands of Britain’s nurses — one of the most revered professions in the country — poses an especially knotty problem.

Tory unity is already starting to fray at the edges, with Sir Jake Berry, a former party chair, and Dan Poulter, a Conservative MP and NHS hospital doctor, saying that Sunak will have to increase the offer to nurses.

Straw said: “You will never win an argument with the nursing profession. It’s impossible.” The problem facing ministers is that bowing to demands to boost the pay of more than 1mn NHS workers in England would cost billions of pounds.

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In understanding Sunak’s approach to the wave of strikes gripping Britain, his allies said it was important to understand that ministers are treating each dispute as distinct. But the overarching aim is to hold down pay amid high budget deficits and inflation at more than 10 per cent.

Strikes in the NHS pose a particular issue for the government but Sunak is more bullish about other labour disputes, notably on the railways, where ministers intervened this month to stop employers offering a 10 per cent pay deal over two years.

“The rail unions are starting to move,” said one senior Conservative, noting that only 63 per cent of RMT rail union members voted to reject a pay offer of 9 per cent over two years from Network Rail, the infrastructure operator. Another union, the TSSA, has accepted Network Rail’s offer.

The sight of RMT leader Mick Lynch this week berating a BBC journalist for “parroting the most rightwing stuff” when she asked about declining union support for the strikes delighted Sunak’s allies. “Lynch is rattled,” said one.

Ministers believe that public support for strikes “tends to fall the longer they go on” and that the government can win the argument at a time when many workers have accepted lower pay offers — certainly less than the 19 per cent demanded by the Royal College of Nursing, the union behind the nurses’ industrial action.

For example, senior Conservatives believe that teachers, who are being balloted by unions for strikes in 2023, are unlikely to have massive public support, given that children had their education disrupted by the Covid pandemic.

Sunak has promised new anti-strike legislation in the new year, limiting the damage caused in key public services by industrial action, and will be cheered on by many Conservative MPs and rightwing newspapers.

The prime minister also believes that Sir Keir Starmer, Labour leader, can be presented as a union lackey — and someone who would make unaffordable pay offers to them, were he to win the next election.

“What is weak is that he is not strong enough to stand up to the unions,” Sunak said on Wednesday. “We are actually protecting the public. They are protecting their paymasters.” Starmer called the nurses’ strike a “badge of shame” for the government.

The strike action by nurses and ambulance drivers presents a serious problem for a government which accepted an independent pay review body’s proposal for a £1,400 pay increase for more than 1mn NHS staff in England, backdated to April. This represents an increase of just under 4 per cent in the average basic pay of nurses.

So far the cabinet and most Tory MPs have held firm, arguing that the government cannot afford a higher pay rise, that it would be inflationary, and that if the NHS staff got more, it would open the door to similar demands from other public sector workers.

But Steve Brine, Tory chair of the House of Commons health committee, called for flexibility, saying an “elegant” way out would be to ask the pay review body to reconsider its recommendation. This idea has so far been rejected by Number 10.

There is nervousness in government, as figures including Sir John Gieve, former Bank of England deputy governor, question whether larger pay rises for public sector workers would significantly fuel inflation.

Lord Nick Macpherson, former permanent secretary at the Treasury, said: “I think the government has got to be careful about its rhetoric here. Public sector workers don’t create inflation.”

Speaking on BBC radio’s The Week in Westminster, he added: “It is actually the private sector which leads the labour market. We’ve also got to recognise that public sector pay has been squeezed for a very long time.”

Some government officials fear that other Tory MPs will join Berry and Poulter and urge the government to offer more money to NHS staff, especially if their constituents start to complain about cancelled operations. “You know what Tory MPs are like,” said one.

Steve Barclay, health secretary, has so far refused to discuss this year’s NHS pay award with the RCN, saying its demand for a 19 per cent increase is “unaffordable”.

But he, like the unions, is looking for a way to end the strikes. Barclay’s allies said he had tried to “start a conversation” about the next NHS pay deal that will take effect in April.

But, in the meantime, Sunak will have to calculate the extent of the likely political damage if the strikes run deep into 2023. James Callaghan’s Labour government never recovered from the “winter of discontent” of 1978-79 and the perception that it had lost control.